September 9, 2019

Tilton Fails To Convince Judge To Toss Bank’s Fraud Suit

By Reenat Sinay

Law360 (August 21, 2019, 6:02 PM EDT) — A New York state judge has refused to grant an early exit

to investment manager Lynn Tilton in a German bank’s $45 million fraud suit against her and her

Patriarch Partners companies, saying Tuesday that there are still disputed issues of fact.


Tilton and Patriarch had argued that the claims brought by Norddeutsche Landesbank Girozentrale,

or Nord/LB, were time-barred, but Justice Joel M. Cohen rejected her summary judgment bid, finding

that there was not conclusive evidence that the bank knew about the purported fraud at the time

Tilton said it did.

“A finder of fact could determine that the decision to sell was causally linked to the alleged fraud,

which plaintiff contends led it to assume a certain level of performance, credit rating, and capital

requirements, which in turn impacted whether to hold or sell the notes,” he said. “A finder of fact

could also reasonably conclude that had Plaintiffs known about the actual Fund structure, they would

never have entered into the transaction in the first place.”


Michael M. Fay of Berg & Androphy PC, an attorney for the bank, told Law360 Wednesday that it was

“pleased” with the judge’s decision and looks forward to trying the case.


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