Reuther – A group of wealthy clients who invested $50 million with two hedge funds felled by last year’s credit crisis are accusing Highland Capital Management’s partners of having lied about key facts.

LV Highland Credit Feeder Fund LLC, an investment vehicle managed by Long Vue Advisors in Boston, and several charitable foundations and wealthy individuals filed the lawsuit on Wednesday in a U.S. district court in Dallas.

The group is charging that the Dallas-based hedge fund firm and its co-founders James Dondero and Mark Okada and three other partners were dishonest about other clients’ requests to exit the funds at a time of increasing market turmoil.

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Reuters – Hedge funds made history in September but not the kind most managers want to remember.

Among the biggest losers, as last month’s returns are slowly revealed to investors, are some of the $1.9 trillion hedge fund industry’s most prominent and most successful names.

Dan Loeb, an activist investor known for his sharply worded letters to poorly performing companies, saw his Third Point Offshore fund tumble 11 percent in September, people familiar with the numbers said on Thursday.

In the first nine months the fund lost 17.86 percent.

Lee Ainslie, who once worked for industry legend Julian Robertson, saw his Maverick Fund lose 19.47 percent in September, leaving the fund down 21.24 percent for the year.

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