January 31, 2007

At Overlawyered yesterday, I took note of a choice new example of the phenomenon of plaintiffs' suing a company after first selling short its stock. This time a hedge fund is pursuing a False Claims Act lawsuit against Allied Capital after having previously taken a short position in Allied's stock. See earlier Point of Law coverage here and here, as well as the Featured Discussion we ran on the subject. Larry Ribstein, one of the participants in that discussion, also notes the case here.