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LONDON (Reuters) - Rubicon Fund Management, one of the top-performing hedge fund firms during the credit crisis, is suing two former partners over a rival firm it claims they secretly planned to set up following an acrimonious internal dispute.
Rubicon, based in London's upmarket Mayfair district, has issued legal proceedings against Tim Attias -- a former boyfriend of model Jerry Hall -- and Santiago Alarco, the former managers of Rubicon's Global Fund, claiming they "behaved dishonestly in failing to disclose" plans for a new firm.
It is also suing Catherine Cripps, who recently left her position as fund of funds manager and head of the research team at fund manager GAM, which was until recently a major investor in Rubicon, a claims document showed.
The case, which centres on a new firm called SATA Partners that Attias and Cripps set up in June, highlights the bitter internal disputes that can arise in a secretive industry dominated by star managers, and the vast sums they are often paid.
Rubicon claims that the three managers "conspired and combined together to set up a new entity" that would compete with Rubicon, breaching agreements signed by the firm's partners.
A lawyer at Herbert Smith, the firm named as acting for SATA in a regulatory filing dated June 2011, could not be reached for comment. Alarco could not be reached for comment.
Attias quit the firm in January this year in the wake of a disagreement between the partners, while Alarco resigned in March.
GAM pulled out the nearly $550 million it had invested in Rubicon, whose total assets were $1.4 billion last year, in February, March and April, the claim said.
A source with close knowledge of the case told Reuters that problems within the firm had begun to surface after founder Paul Brewer suffered a near-fatal riding accident in summer 2009, keeping him away from work until late 2010.
"The issue began to develop while Paul was away...By the end of the year, relations between the partners had become very, very strained," the source said.
Rubicon also claims that it would not have paid almost 6 million pounds to Attias and more than 11 million pounds to Alarco, had it been aware of the plans to set up SATA.
Rubicon's Master fund was one of the standout performers during the financial crisis, making 44.8 percent during 2008's market chaos when the average hedge fund lost around 20 percent.
GAM said it was not part of the proceedings.
Editing by Sinead Cruise and Erica Billingham