DMS Management Sues to Block Ex-Tangerine Executive Claim

DMS Management (USA) Inc. sued a former executive of the failed Tangerine Investment Management Inc., accusing him of making “extortionate threats” to bring racketeering claims against it.

Steven J. Goodman, the former group chief executive officer and director of Cayman Islands-based Tangerine, is attempting to “shift blame to DMS USA and others within the DMS-affiliated companies for his egregious mismanagement of Tangerine’s affairs,” as well as for alleged misconduct by a Tangerine shareholder, DMS said in a complaint filed today in Manhattan federal court.

DMS said Goodman is making an “effort to extort a settlement from sources he believes to have deeper pockets” by threating to bring racketeering claims purportedly worth hundreds of millions of dollars stemming from the alleged misconduct involving a litigation funding entity.

New York-based DMS said it appears to have been targeted by Goodman because an executive director of affiliate DMS Offshore Investment Services Ltd. had been a director of Tangerine.

Howard Foster, a lawyer for Goodman, said his claims arise from the breach of an employment agreement with the Tangerine hedge fund.

Mismanagement Allegation

“We allege that hedge fund, Tangerine Investment Management, was mismanaged by a director provided to it by DMS Offshore Investment Services,” Foster said in an e-mail.

Goodman’s claims are not against DMS Management (USA), Foster said.

DMS is seeking a court order that it isn’t liable for racketeering allegations because “there is absolutely no connection between DMS USA and Mr. Goodman’s threatened claims.”

A lawyer for DMS, James C. McCarroll, said in a statement that the complaint sends a clear message that the firm “will not be bullied.”

The case is DMS Management (USA) Inc. v. Steven J. Goodman, 14-cv-4062, U.S. District Court, Southern District of New York (Manhattan).

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