High-profile divorce lawyer sues AllianceBernstein

FWR Staff

21 October 2008

Raoul Felder says investment firm told him a toxic fund was "doing great". New York-based divorce attorney Raoul Felder wants $5 million out of AllianceBernstein for blowing through $200,000 of his money on a risky hedge fund when all he wanted was capital preservation, according to the suit he filed in Manhattan Supreme Court this week. AllianceBernstein doesn't comment on legal actions.

At a January 2007 with an AllianceBernstein advisor, Felder made it clear that his "goal was the preservation of capital," according to his suit. Instead he was steered to a hedge fund in which he ended up putting $750,000.

Drop in a bucket

Felder says AllianceBernstein staffers told him the hedge fund was "doing great," and when he found out otherwise, they attempted to placate him with blandishments like "What does it matter to you? You have a lot of money," according to the plaintiff.

After losing $200,000 in principal and fees Felder pulled his money out of the fund. He alleges that AllianceBernstein committed fraud in the matter.

Felder is known as a "celebrity" divorce attorney and a cable-news commentator.

Similar suits against hedge-fund managers have proliferated over the past year.

AXA-owned AllianceBernstein manages around $590 billion.

In New York's legal system a"supreme" court isn't the highest court in the state. Rather, it's what other states might term a "superior" or "district" court. New York has a "supreme" court for each of its 62 counties.

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