JUSTICE

THE DEFENCE VS. A REALLY BIG CHEQUE

MARK STEYN April 16 2007
JUSTICE

THE DEFENCE VS. A REALLY BIG CHEQUE

MARK STEYN April 16 2007

Brian Hunter: once bitten but never shy

BY <dc:creator>NICHOLAS KÖHLER</dc:creator> • A couple ofyears ago, when he was just 31, Calgary’s Brian Hunter, a tall, unassuming University of Alberta math-geek-turned-iiber-successful natural gas trader, was being quietly hailed for generating the Amaranth Advisors hedge fund, his employer, $1 billion in profit. Reputed to drive a Ferrari in the summer and a Bentley in the winter, Hunter was being aggressively courted by U.S. hedge funds, but remained little known until his enormous 2005 bonus hit an industry trade magazine.

Then, just a year later, Hunter lost Amaranth $6.5 billion—$560 million of it on Sept. 14,2006, alone—by gambling on the weather. It was the largest hedge fund loss in history. Hunter’s big bets had inflated gas prices, leading the market to shocking lows. Now the 33-year-old Hunter is asking investors for a second chance. And he’s getting it.

His new hedge fund, Solengo Capital, is reportedly seeking to amass $800 million while requiring investors to lock their money in for two years. More than just an echo of Amaranth, Solengo is something of a redux: former Amaranth colleagues Karl Koster, Shane Lee and Matthew Calhoun are also involved. The gambit unfolds even as Hunter, who refused to comment for this story, is haunted by Amaranth: a legal action launched last week by the San Diego County Employees Retirement Association names Hunter and other Amaranth types in what is likely the first in a flurry of lawsuits.

Meanwhile, Solengo has moved on litigation of its own, suing one online site for copyright infringement after it would not remove a posting of its “confidential” promotional literature. The six-month respite from such Amaranthentine antics isn’t much of a mora-

torium, leading to complaints Hunter is contributing to increasingly bad optics surrounding hedge funds. But when you’ve demonstrated to Wall Street your ability to win—even in a remote past (just two years ago) before you became an indelible loser—Wall Street will always afford you another shot. M