Cayman Net News- According to a report in the Financial Times (FT), investors in two failed Cayman-registered hedge funds began legal action here on Tuesday in an attempt to seize control of the funds, which they hope to use as a platform to demand compensation from US investment bank, Bear Stearns.<\/p>\n
The hearings listed for the Grand Court over 19 to 21 February before the Chief Justice Hon Anthony Smellie, are reported by the FT to involve a group of rebel shareholders in the Bear Stearns Enhanced Leverage Overseas and High Grade Overseas funds, who are now attempting to reverse the bank’s decision to put them into liquidation.<\/p>\n
Apparently, investors had waged a successful campaign to appoint their own directors to one fund, a move to gain control that was blocked when the fund was put into liquidation.<\/p>\n
The case represents just another facet in the complex legal action against Bear Stearns after the failure of the two hedge funds last July, with a combined loss of $1.6 billion, after bad investments in sub-prime mortgages.<\/p>\n