BAY HARBOUR MANAGEMENT, LLC v. Carothers

MEMORANDUM DECISION

CHIN, District Judge.

In this securities fraud case, plaintiff Bay Harbour Management LLC (“Bay Harbour”) purchased $19 million in junk bonds issued by Levitz Home Furnishings, Inc. (“Levitz”) in November 2004 as part of a $130 million private placement (the “Offering”). In October 2005, less than a year later, Levitz filed for bankruptcy protection. The value of the bonds dropped significantly, and Bay Harbour brought this action claiming that it was induced into purchasing the bonds by fraudulent statements and omissions made by defendants misrepresenting Levitz’s…