Greedy Hedge Fund Managers Suing Porsche For $1 Billion

Reason number one why the ‘10s are worse than the ‘80s: greedy hedge fund managers are suing Porsche not because they drove backwards into a tree, but because the company's surprise takeover of VW caught them with their pants down.

Back in October, 2008 Porsche shocked the world by revealing it held 75 percent of VW stock. At the time, a bunch of greedy hedge fund managers were "shorting" VW stock, selling stock they'd borrowed in the hope of buying it back later at a lower price and pocketing the difference. Basically, they were gambling with other people's money that the stock would drop in value. When Porsche made its announcement, VW stock increased in value, forcing the greedy hedge fund managers to buy it back at a higher price and, predictably, they lost money.

Now, the greedy hedge fund managers from Elliott Associates, Glenhill Capital Management, Glenview Capital Management and Perry Capital weren't too happy about losing in excess of $1 billion and, naturally, think it's someone else's fault. Specifically, they're upset that, in the run up to the announcement, Porsche denied claims that it wanted to takeover VW. It's expected that other sore losers greedy investors could join the lawsuit, increasing it to as much as $10 billion. [via Autocar]