Sanctions Sought, But $100M RICO Claim Survives in Hard-Fought Divorce
Seeking to up the ante in a high-profile years-ago divorce case, the ex-wife of one of Wall Street’s wealthiest hedge fund managers filed a federal civil racketeering suit against him and his companies last month, contending that she had been defrauded through a scheme to conceal assets.
She had gotten wind of the scheme, Patricia Cohen says, after seeing a 60 Minutes television news broadcast criticizing Steven Cohen in March 2006 that made her wonder whether she had been misled during their divorce. Seeking damages of over $100 million, she filed suit in federal court in Manhattan, contending that he lied under oath in divorce affidavits nearly two decades ago, according to a Bloomberg report in mid-December and another Bloomberg article yesterday.
Steven Cohen, who operates SAC Capital Advisors, has an estimated net worth of more than $6 billion, putting him 36th on the Forbes 400 list of the richest Americans.
In a responding blast, his side said the allegations aren’t true and attacked the ethics of her counsel, Paul Batista, seeking federal-court sanctions for a claimed frivolous filing. And, earlier this week, it appeared that the tactic might have succeeded in quashing his ex-wife’s claim. However, a dismissal filed Tuesday by Batista was “purely procedural,” he tells the New York Times.
An impasse between Batista and Patricia Cohen created a lapse in communication between the two, the newspaper explains. But her new counsel, Gaytri Kachroo, plans to file an amended complaint and continue with the Racketeer Influenced and Corrupt Organizations Act, or RICO, case, and complains that she was never notified beforehand by Batista of the planned dismissal.
“Ms. Cohen claims a continuing pattern of racketeering activity,” Kachroo writes in a letter to the federal court that was reported today in the latest Bloomberg article on the unusual application of a law that is ordinarily cited in organized-crime cases. “This is not a mere marital dispute.”
Additional coverage:
Dow Jones Newswires: “SAC Capital’s Steven Cohen Sued For Racketeering By Ex-Wife”
The Spread (New York Post): “Steven Cohen’s SAC capital ends ‘09 up 28.39%”
