A Dallas County judge on Tuesday dismissed a lawsuit filed against Neiman Marcus that alleged the Dallas-based luxury retailer engaged in a $1 billion fraudulent transfer that harmed Marble Ridge, a creditor.
In a two-page ruling, Dallas District Judge Tonya Parker said Marble Ridge’s lawsuit “should be dismissed for lack of subject matter jurisdiction.”
The ruling concludes one of two hurdles that Neiman’s will have to overcome in Judge Parker’s court this month to resolve the litigation. On Thursday, Judge Parker will consider whether she should dismiss Neiman’s countersuit against Marble Ridge, which the hedge fund says should be thrown out due to anti-SLAPP statutes.
Marble Ridge sued Neiman’s on Dec. 10, alleging the fraudulent transfer occurred when the retailer transferred the ownership of its European e-commerce unit, MyTheresa, to Neiman’s parent company in a transaction that was strategically planned to benefit its private equity owners, Ares Management and Canada Pension Plan Investment Board.
Neiman’s filed a countersuit four days later and asked Judge Parker to dismiss Marble Ridge’s suit, which Neiman’s said is just a means to “extract improper benefits for itself.” Neiman’s also alleges Marble Ridge has been publicly attacking the retailer over several months by circulating false statements about it being in default on its debt.
Neiman’s countersuit was filed by way of a plea for lack of jurisdiction. Mike Lynn, Neiman’s lead lawyer, told The Texas Lawbook in an email that he was pleased with the outcome and commended the careful attention Judge Parker has paid to the case thus far.
“It is always satisfying to have a court dismiss a claim for lack of jurisdiction when, as here, the claimant did not own the claim and the claimant had no right to make the claim it did,” said Lynn, a partner at Lynn Pinker Cox & Hurst. “The documents in this case are long, complex, and dense, and it takes a particularly studious judge to get this ruling right. We in Dallas are blessed with such a judge.”
New York attorney Sigmund Wissner-Gross, who is leading the litigation for Marble Ridge, deferred comment to officials at Marble Ridge.
A spokesperson for Marble Ridge said while the firm hoped Judge Parker “would rule differently on our standing to bring the fraudulent conveyance claims, this particular ruling does not address the key issues, which are the inappropriate transfer by Neiman Marcus of the MyTheresa assets; the questionable financial condition of Neiman; and its implication for stakeholders.”
Neiman’s legal team also includes Elizabeth Ryan , Chris Patton and Chisara Ezie-Boncoeur of Lynn Pinker Cox & Hurst.
Marble Ridge’s local lawyer is Josh Hedrick of Hedrick Kring.
Judge Parker’s ruling followed a hearing held on March 7, where Marble Ridge argued it had standing to bring its claims for fraudulent transfer under the Texas Uniform Fraudulent Transfer Act (TUFTA) in its capacity as a creditor of Neiman’s.
Neiman’s countered that Marble Ridge has no standing since clauses in its own governing documents with creditors as well as previous caselaw related to TUFTA don’t support Marble Ridge’s arguments.
Judge Parker’s Tuesday ruling dismissed Marble Ridge’s claims against Neiman’s with prejudice.