2nd Circ. Affirms Goldman's $21M Loss in Bayou Arbitration

Law360, New York (July 3, 2012, 6:08 PM EDT) -- The Second Circuit on Tuesday affirmed an arbitration award compelling a Goldman Sachs Group Inc. unit to pay $20.6 million to the unsecured creditors of a bankrupt group of hedge funds, finding that the arbitrators did not ignore the law in imposing the award.

The three-judge panel ruled that Financial Industry Regulatory Authority arbitrators did not overstep their bounds in determining that deposits placed with Goldman and channeled to the Bayou Group LLC — a group of hedge funds run as a Ponzi scheme that collapsed...
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