15 Civ. 01446

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In an opinion today, the Second Circuit reversed a ruling by Judge Pauley (see our prior coverage here) that had allowed hedge fund manager David Ganek to proceed with claims against the U.S. Attorney and various other government officials over a raid that led to the collapse of his hedge fund, Level Global.  Mr. Ganek had alleged, in essence, that the affidavit supporting the raid was based on false testimony suggesting he knowingly traded on inside information.

The Second Circuit reversed, primarily on the ground that, even absent the allegedly false  information, the raid would have been supported by probable cause:
Continue Reading Second Circuit Throws Out Case Alleging Government Fabricated Evidence for Hedge Fund Raid, Leading to Fund’s Collapse

In an opinion today, Judge Pauley largely denied a motion to dismiss a civil case brought by David Ganek, the former head of hedge fund Level Global.  Mr. Ganek accuses U.S. Attorney Preet Bharara and various other government officials of using a fabricated affidavit – which was later contradicted by trial testimony – as the basis for a search warrant and office raid that ultimately caused the collapse of Level Global.   According to Mr. Ganek, the government tipped off the Wall Street Journal about the raid, so as to inflict the maximum harm, and without any legitimate law enforcement purpose.  Judge Pauley described the allegations as “grave” and allowed most of the claims, based on the Fourth and Fifth Amendments, to proceed.

He ruled that the claims could even proceed against supervisors in the U.S. attorney’s office because the detailed facts alleged made it at least plausible that they were involved:
Continue Reading Judge Pauley Denies Motion to Dismiss Civil Suit Accusing Federal Prosecutors of Fabricating Evidence that Led to Collapse of Hedge Fund

In a complaint unsealed yesterday, David Ganek, the former head of hedge fund Level Global, accuses U.S. Attorney Preet Bharara and various other government officials of fabricating evidence that led to an office raid and, ultimately, to the collapse of Level Global.  The complaint begins:
Continue Reading Newly Unsealed Complaint Accuses U.S. Attorney of Fabricating Evidence for Raid that Led to Hedge Fund’s Collapse