Solengo Capital Advisors v. Dealbreaker.com (letter) [1]

Dealbreaker.com [2], a website that describes itself as "an online business tabloid and Wall Street gossip site," received a letter [3] from counsel for Solengo Capital, a hedge fund founded by former Amaranth Advisors traders, asserting that Dealbreaker's posting of Solengo's prospectus [4] was a violation of Solengo's copyright.

In response to the letter, editors at Dealbreaker said the materials were of legitimate news value and refused to remove them, telling Reuters [5]:

"We think it's valuable to our readers and the public to be able to see the information in it," said John Carney, DealBreaker editor, in an interview on Friday.

The legal dust-up is the latest stemming from the abrupt implosion of $9.3 billion hedge fund Amaranth last year, which shocked investors and raised awareness of hedge fund risk. The recent founding of Solengo by some of the energy traders blamed for the $6 billion in losses that caused the Amaranth collapse has also generated controversy.

Carney, a former corporate lawyer, said his site plans to contest any legal challenge. "We're willing to take it as far as it merits. I don't expect to defy a court order or go to jail for it, however."

On March 30, 2007, Solengo followed up the letter with an order to show cause seeking a preliminary injunction ordering Dealbreaker to remove the prospectus from its website. After the court denied the injunction [6] request, Solengo filed a complaint [7] alleging copyright infringement against the website and several of its editors.