As previously detailed in the Hedge Fund Law Report, Gentry Beach (Beach), and Robert Vollero (Vollero, and collectively, the plaintiffs), two former employees of Touradji Capital Management, LP (Touradji Capital), filed a lawsuit a year ago in New York State Supreme Court against Touradji Capital and its founder Paul Touradji (collectively, the defendants). See “New York State Supreme Court Upholds Former Portfolio Managers’ Claims Against Hedge Fund Manager Touradji Capital for Breach of Contract and Intentional Infliction of Emotional Distress; Dismisses Remaining Causes of Action
,” Hedge Fund Law Report, Vol. 2, No. 39 (Oct. 1, 2009). In that lawsuit, Beach and Vollero, each of whom has since started his own hedge fund management firm, asserted that the defendants owed them almost $50 million in bonuses and profit sharing, and that Touradji had threatened Beach’s welfare. The defendants have now vehemently struck back. On November 4, 2009, they filed a countersuit against Beach and Vollero, claiming that, while employed by Touradji Capital, the two breached their fiduciary duties to the firm, and that after they left, they committed unfair competition, tortiously interfered with Touradji Capital’s business relationships, stole its trade secrets and defamed the firm. The defendants’ counterclaims seek more than $250 million in damages. This article summarizes the allegations in Touradji’s counter-attack. It also discusses the withdrawal by Amaranth LLC and Amaranth Advisors L.L.C. of a summons filed on September 18 in New York state court against Touradji. That summons alleged, among other things, breach of a confidentiality agreement Touradji and Amaranth had signed in advance of the transfer of Amaranth’s base metals portfolio to Touradji.