Arnold & Porter Obtains Affirmance on Appeal of Judgment in Favor of Kynikos Associates and Jim Chanos
Arnold & Porter prevailed in the New Jersey Appellate Division on the judgment it obtained in favor of investment advisor Kynikos Associates (Kynikos) and its founder Jim Chanos in a multibillion-dollar lawsuit that alleged that the defendants violated the New Jersey Racketeer Influenced and Corrupt Organizations Act.
First filed in July 2006, the lawsuit against Chanos and Kynikos, among others, claimed that the defendants were part of a group of investment professionals who purportedly caused financial harm to Fairfax Financial Holdings, a Canadian insurance holding company, and Crum & Forster, its New Jersey subsidiary, through a short-selling enterprise. Following more than 150 depositions and extensive document production, summary judgment was granted in favor of Kynikos and Chanos. On April 27, 2017, the New Jersey Appellate Division affirmed the dismissal of all claims against Chanos and Kynikos in a 156-page decision, but reversed and remanded as to certain other defendants.
Securities and Enforcement Litigation partners Stewart Aaron and Susan Shin led the client team, with support from Litigation associate Daniel Bernstein on the appeal.