In another claim, Glass alleges that in the second half of 2002, he developed an arbitrage fund for the joint venture. But in the winter of 2002/03, Wyly's representatives demanded that Glass hire Wyly's marketing firm, Ranger Capital Markets, in perpetuity to market the fund to investors, Glass claims in the suit. Glass says he was given two hours to agree to the demand and, when he didn't, Wyly yanked the arbitrage fund from the joint venture and pursued it independently in another of his investment vehicles.
CONFLICTING ACCOUNTS. Further, Glass alleges that, at a meeting on Mar. 7, 2003, Wyly threatened to file a lawsuit accusing Glass of fraud, and also to send fund investors a letter expressing that he was "not comfortable continuing" his associations with Glass.
Glass contends Wyly told him all that could be avoided if Glass further altered terms of the agreement that were favorable to Wyly. Then, in late March, Glass says Wyly's entities proposed a further restructuring of the joint-venture agreement that would have allowed Glass to avoid litigation.
The complaint describes the threatened lawsuit and a draft letter to investors as "a crude form of business extortion to attempt to exact for themselves more favorable