SAC Capital's Cohen Will Seek Dismissal of Ex-Wife's Lawsuit, Lawyer Says
SAC Capital Advisors LP founder Steven A. Cohen, whose ex-wife accuses him in a lawsuit of cheating her out of money in their 1990s divorce, will ask a judge to dismiss the suit, his lawyer said in court today.
Martin Klotz, a lawyer for Cohen, said he will make the motion on May 7. In an April 20 letter to U.S. District Judge Richard J. Holwell, Klotz said a dismissal is warranted in part because the deadline has passed for filing such a suit.
“Plaintiff’s divorce, and the conduct about which she complains, are now ancient history,” wrote Klotz, a lawyer with Willkie Farr & Gallagher LLP in New York.
Patricia Cohen seeks a “substantial, if not controlling, interest in SAC Capital, and various related SAC entities, now valued at over $12 billion,” according to an amended complaint filed this month in Manhattan federal court.
Gaytri D. Kachroo, Patricia Cohen’s lawyer, asked for and was granted 45 days to respond to the dismissal motion.
Patricia Cohen, who separated from her then-husband in 1988, claims assets were hidden from her and the New York state courts during their divorce proceedings. She says she’s entitled to at least half of his hedge fund business, which was developed in part with $1 million Patricia earned from a real estate business.
Steven Cohen, 53, started SAC in 1992 with about $25 million and the firm now has about $14 billion under management.
Patricia Cohen says the hedge-fund firm is “the product of an ongoing racketeering scheme” that has engaged in insider trading, bank fraud, money laundering and other misconduct.
Klotz said in his letter that the complaint doesn’t allege the necessary elements for a racketeering case.
Steven Cohen claimed the couple had $17 million in marital assets in the divorce, and Patricia Cohen accepted a $3.5 million settlement, $2.5 million of which was an apartment, according to the complaint.
“Only three weeks after their second round of divorce proceedings had concluded in 1992, Steve reassembled SAC Trading” under “SAC Capital and other entities, with some newfound $25 million,” according to the complaint.
Cohen, who married Steven Cohen in 1979, said she devoted herself to her children and husband during their marriage and engaged in real-estate transactions in 1980 that earned about $1 million that she turned over to her husband to invest.
Patricia Cohen first sued Dec. 16. Paul Batista, the lawyer who filed the original complaint, withdrew the suit in January because he said Cohen wanted to use a new lawyer.
On April 1, Batista sued Patricia Cohen and the new attorney, Cambridge, Massachusetts-based Kachroo, saying he is owed fees for the work he did on the case. Kachroo and Cohen have denied the allegations in that case.
Kachroo filed the amended complaint April 7 and it was docketed the next day.
Willkie Farr is primary outside counsel to Bloomberg LP, the parent company of Bloomberg News.
The case is Cohen v. Cohen, 09-cv-10230, U.S. District Court, Southern District of New York (Manhattan).
To contact the reporter on this story: Thom Weidlich in New York federal court at firstname.lastname@example.org.