On February 29, 2008, the U.S. District Court for the Southern District of New York, dismissed claims by funds managed by Ritchie Capital against Coventry First and all other defendants for civil violations of the federal RICO statutes. Click here to review the Opinion and Order. In the order, the Court also refused to reconsider an earlier dismissal of Ritchie's fraud claims against the same defendants. The order disposes of all claims by Ritchie Capital except breach of contract claims against certain Coventry First entities.
Ritchie Capital commenced its lawsuit after Moody's withdrew ratings on several of the insurance policies purchased by the Ritchie Capital funds from Coventry First after a suit by the New York Attorney General against Coventry First was commenced in 2006. Ritchie Capital's fraud claims were dismissed in the Court's original dismissal order because among other matters the Court found that Coventry First owed no fiduciary duty to Ritchie Capital. In dismissing the civil RICO claims, the Court held that Ritchie Capital lacked standing to pursue the claims, finding that the link between the alleged predicate acts to the damages suffered by Ritchie Capital was "too attenuated a causal connection to confer RICO standing."