Bayou Hedge Fund Investors Can Sue on Fraudulent Conveyance Theory

A bankruptcy judge in New York held that investors who lost money in the failed hedge fund Bayou Management could seek to recoup $140 million withdrawn from the fund before its collapse in 2005, on the ground that the withdrawals were fraudulent conveyances intended to defraud creditors.  See WSJ, Bayou Investors Who Lost Money in Collapse Can Sue Other Investors.