Cobalt Receiver Can Sue Firms Over $23M Fraud: Report

Law360, New York (September 12, 2011, 3:21 PM EDT) -- A New York federal judge should not dismiss a receiver’s malpractice suit against Cohen & Werz LLC and two other law firms that allegedly helped the principals of Cobalt Capital Funding LLC, now imprisoned, loot the companies as part of a $23 million securities scam, a magistrate judge recommended Friday.

U.S. Magistrate Judge Michael Dolinger concluded that a recent decision in litigation over the collapse of Refco Inc. does not undermine the court’s July 2009 ruling that let the receiver for the Cobalt entities go after...
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