Case Studies

A Tannenbaum Helpern client had lent millions of dollars to a reputable New York-based hedge fund in exchange for a secured interest in a valuable asset of the fund. Several months later, the fund was placed into liquidation in the Cayman Islands, and the court-appointed representatives of the fund refused to honor the security interest, and filed a declaratory judgment action against our client. Our client counterclaimed for breach of contract, seeking millions of dollars in damages arising from the dishonored loan.

Through two years of hotly contested litigation, Tannenbaum Helpern refuted the hedge fund’s theory of the case, eliciting admissions and key documents that disproved critical factual allegations by the fund. Tannenbaum Helpern was also able to marshal compelling evidence of its client’s good faith, the legitimacy of the loan and the client’s right to enforce its security interest in the fund asset. Poised to file a motion for summary judgment, Tannenbaum Helpern’s client was able to enter into settlement negotiations from a position of strength.

In the end, Tannenbaum Helpern was able to secure a settlement with a guaranteed multi-million dollar payment, and the possibility of significant upside in the form of additional distributions from the Cayman liquidation estate. This was a particularly positive outcome given that Tannenbaum Helpern was litigating against an insolvent entity, and such litigations typically fail to yield the kinds of significant payments for creditors that Tannenbaum Helpern was able to secure in this case.