Koch Lawsuits
The downside of the asset class has been the risk of being cheated. Koch, the founder of Oxbow Corp., a closely held commodities marketing and mining company in Palm Beach, Florida, estimated that hundreds of millions of dollars in counterfeit wine are sloshing around in the vintage market.
Koch has filed seven lawsuits in relation to wine, according to Brad Goldstein, a spokesman for Oxbow. He won a fraud lawsuit two months ago in which he claimed a consigner sold him 24 counterfeit bottles of wine from France’s Bordeaux region, including many purported grand crus that cost him tens of thousands of dollars.
“This wouldn’t be a regular thing with Goldman,” said Stephen Burton, the founder of Bordeaux Cellars Ltd., a London- based firm that finances wine acquisitions. “It wouldn’t be made available to the general public, that is for sure.”
DeLeon Tequila
Cader was the co-head of Spear, Leeds & Kellogg LP when Goldman Sachs acquired the closely held firm, ranked as the largest specialist on the New York Stock Exchange, for $6.2 billion in November 2000, according to data compiled by Bloomberg. He received Goldman Sachs stock through the buyout and raised at least $85 million by selling 1.1 million shares between January and October 2002, according to filings with the U.S. Securities and Exchange Commission.
After leaving Goldman Sachs, Cader bought stocks through an investment vehicle called ACNYC LLC. He joined a group of former Spear Leeds executives who bought the Tampa Bay Rays major league baseball team, and he also invested in Quench LLC, a Venice, California, company that supplies DeLeon Tequila, a premium brand that sells for as much as $825 a bottle, according to records filed with the California Department of Alcoholic Beverage Control.
Lichtenstein Lawsuit
Goldman Sachs’s banking unit filed a notice in August 2010 with the New York Department of State disclosing that it had entered into a credit agreement with Cader backed by his securities account at the firm as well as his interests in 15 Goldman Sachs investment funds. He added collateral several times, most recently in May, when Goldman Sachs amended the notice to say the loan was also now secured by 14,985 bottles of wine, including a bottle of Burgundy produced by Domaine de la Romanee Conti in 1929.
Cader was sued in April by hedge-fund manager Warren Lichtenstein, the chairman of New York-based Steel Partners LLC, who claimed Cader helped wrongly inflate child support payments for the mother of Lichtenstein’s 5-year-old daughter.