Plaintiffs Keystone Associates LLC and Cable Mountain Partners LLC are both run by Larry Lunt, according to a person familiar with the matter, who asked not to be identified because the details are private. Larry Lunt is the father of John Lunt, founder of Lunt Capital Management, which designed an index tracked by one of the funds that Elkhorn used to manage.
The Lunt Low Vol/High Beta Tactical ETF is now run by Innovator.
A court document cites conversations about the Barclays arrangement between John Lunt -- described in the suit as a manager at Keystone -- and Elkhorn’s Fulton.
Keystone and Cable Mountain are suing Elkhorn and Fulton for alleged securities fraud, common-law fraud and negligent misrepresentation, and say they suffered damages of at least $2.5 million. John Lunt couldn’t immediately be reached for comment; Larry Lunt declined to comment. Keystone and Cable Mountain’s Delaware counsel declined to comment.
The case is Keystone Associates LLC v. Fulton, 18-cv-01235, U.S. District Court, District of Delaware.
This article was provided by Bloomberg News.