Meredith Whitney’s hedge fund is being sued by its biggest investor, a fund connected to billionaire Michael Platt’s BlueCrest Capital Management, as demands to recoup money spill into court, according to people with knowledge of the dispute.

Platt’s BlueCrest Capital Opportunities brought the lawsuit in Bermuda earlier this month, seeking to get back its $46 million stake in Whitney’s American Revival Fund, the people said, asking for anonymity because the case isn’t public. Her hedge fund slid 11 percent this year through November despite a rising stock market.

The suit shows how quickly relations have soured since last year, when Platt helped Whitney, once one of Wall Street’s most famous analysts, start her new firm, Kenbelle Capital. The BlueCrest fund invested $50 million that November, then asked to redeem this October, expecting payment around the end of last month, the people said.

“A lawsuit was filed in Bermuda, contrary explicitly to a contractual agreement that any lawsuits or legal disputes would be resolved here in New York,” Whitney’s attorney, Stanley S. Arkin, said by phone. Asked what prompted the redemption demand, he referred to BlueCrest’s own returns and client withdrawals.

Ed Orlebar, a spokesman for BlueCrest in London, declined to comment.

‘Feels Insulted’

The Bermuda court doesn’t make case filings public. A clerk there confirmed this week that the BlueCrest fund filed a suit against American Revival, and declined to provide a copy.

It’s been an unusually hard year for fledgling money managers, with institutional investors flocking to the biggest players and hedge funds closing at a rate not seen since the financial crisis. On average, hedge funds returned about 2 percent during the year’s first 11 months, according to data compiled by Bloomberg.

Whitney aimed for returns of 12 percent to 17 percent by profiting from growth in what she called “America’s Heartland,” a presentation showed last year. Instead, her fund was down in eight of the past 11 months, according to its returns. The Standard & Poor’s 500 Index climbed about 12 percent over that span.

Top Kenbelle executives including the chief financial officer and a co-founder have left, and her full-floor office in a high-rise on Manhattan’s Madison Avenue is now listed for sublease, with furniture available.