(Adds countersuit by Touradji in 12th paragraph.)
July 1 (Bloomberg) -- A New York judge reinstated three claims brought by former employees of Touradji Capital Management LP against the commodity hedge-fund firm that were dismissed by a lower court in 2009.
The trial court wrongly dismissed a claim accusing Touradji of unjust enrichment from allegedly withholding 2005 bonuses to the employees and reinvesting it without their permission, the appeals court ruled yesterday, reversing Justice Richard B. Lowe of state Supreme Court.
Gentry Beach, a former portfolio manager for Touradji, sued in December 2008, claiming the company failed to pay him bonuses for three years. Former employee Robert Vollero joined the complaint in January 2009, expanding damages over the claims to more than $50 million. Lowe’s ruling is the latest in a volley of pretrial decisions in the case.
“It’s a technical ruling that is of no consequence on the case going forward,” Sean O’Brien, an attorney for Touradji said today in a phone interview. “These are claims which we are confident will ultimately be dismissed.
Lowe also reinstated a claim alleging violation of New York labor laws ruling that the lower court erred in concluding the former Touradji employees compensation wasn’t wages as defined under state laws.
Beach and his colleague argued that their compensation wasn’t completely discretionary and based on their own productivity and not entirely based on Touradji’s financial results, the judge said.
David Greenberger, an attorney for Vollero and Beach, called the ruling “a positive development.”
Beach and Vollero worked as fund managers for Touradji, a firm founded by billionaire Paul Touradji in 2005.
The firm allegedly failed to compensate the men after repeated demands. Touradji paid Vollero a portion of the money owed to him but declined to compensate Beach and threatened to ruin his career if he didn’t make a public apology for certain investment decisions made by the firm, according to court papers.
The firm continued to withhold Beach’s compensation even after he made the apology. Beach resigned in September 2008, following a verbal confrontation with Touradji. Vollero resigned about three months later, according to papers filed in the case.
Touradji denied the allegations and in 2008 called Beach a disgruntled employee and poor performer.
Touradji countersued Beach and Vollero in 2009 asking for at least $250 million and alleging breaches of fiduciary duty, defamation and unfair competition. The action has survived all challenges by the men, Adam Weiner, a Touradji spokesman, said today by e-mail.
The case is Beach v. Touradji Capital Management, 603611/08, New York State Supreme Court, New York County, and the appeal is in New York Supreme Court, Appellate Division, First Department (Manhattan).
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