No Pay, No Pal

According to news reports (InvestmentNews.com - registration required), a Cyprus based investment company is suing Clarium Capital Management, a hedge fund headed by PayPal founder Peter Thiel, alleging that it was defrauded out of millions of dollars over a period of eight years.

The suit was filed earlier this week by Amisil Holdings Ltd. of Cyprus in the United States District Court for the Northern District of California.

According to news reports, Amisil first invested in Clarium in 1998. At that time, Clarium was known as Thiel Capital Management. Amisil's investment is thought to be equivalent to a 1% interest in the hedge fund.

The article contains a colorful quote from a representative of the plaintiff:

Amisil has not received a single distribution from Clarium, while he [Mr. Thiel] has skimmed tens of millions of dollars out of Clarium into his own pockets. There's been no pay for us, and he's been no pal.

Amisil is represented by Harvey L. Leiderman of Reed Smith LLP's San Francisco office. Leiderman is a recent addition to the firm, according to this announcement.

Daily Trivia: Mr. Thiel started as a derivatives trader at Credit Suisse Group and in 2003 nearly bought Martha Stewart's Manhattan duplex condo. Ms. Stewart later sold the condo the day before she was sentenced for crimes related to her well-timed sale of Imclone Systems Inc. stock in late 2001.