Hedge Fund Pares Movie Co. Founder’s $100M Fraud Suit

Law360 (January 10, 2017) A California judge Monday trimmed a $100 million suit brought by the founder of Modern VideoFilm alleging hedge fund Medley Capital Corp. fraudulently took over the Hollywood postproduction company, saying an aiding and abetting claim was “devoid of any factual allegations.” Moshe Barkat, through his ownership of Modern VideoFilm Holdings LLC — the sole holder of the now-defunct company’s shares at the time control was assumed by Medley — filed suit against the hedge fund and a host of other defendants in August 2016, about two years after he was fired as CEO of the company he founded. On Monday, Los Angeles Superior Court Judge Daniel S. Murphy dismissed the claim of aiding and abetting in a breach of fiduciary duty. Medley Capital Corp., Medley Opportunity Fund II LP, MCC Advisors LLC, Richard Craybas and James Feelev are represented by Robert R. Moore, Michael J. Betz and Charles D. Jarrell of Allen Matkins Leck Gamble Mallory & Natsis LLP.