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Chinese Fugitive Tycoon Guo Wengui Beats Hedge Fund In U.S. Court As $88 Million Lawsuit Tossed

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With Chinese fugitive tycoon Guo Wengui living in a $78 million apartment in Manhattan, Guo’s adversaries have flocked to New York state court in recent months to make claims against him. Guo, who is seeking asylum in the U.S., has argued that these disputes don’t belong in U.S. courts and on Wednesday a New York state judge agreed with him.

Judge Barry Ostrager tossed the lawsuit that had been filed in Manhattan’s New York state court by a Hong Kong-based hedge fund against Guo, ruling that a New York state court was an inappropriate venue for such litigation.

ANDREW TESTA/The New York Times/Redux

“New York has no interest in deciding a dispute between a Hong Kong investment fund and a citizen of the People’s Republic of China with respect to a transaction governed by Hong Kong law relating to real estate in the PRC notwithstanding that the defendant citizen of the PRC presently resided in New York,” Judge Ostrager said.

A hedge fund run by Pacific Alliance Group, which manages $16 billion, sued Guo for $88 million it claimed he owed it in April, the same day that an arrest notice issued by the global crime fighting organization Interpol was publicized. The Interpol notice was made on the request of China, which is seeking to detain Guo for charges linked to corruption.

Soon after, other plaintiffs ventured across the Pacific Ocean to file lawsuits against Guo. Some of those lawsuits also involve business disputes in China while others accuse Guo of defamation, like those filed by the mysterious HNA Group conglomerate and prominent Chinese journalist Hu Shuli. Using social media, Guo has been accusing prominent people in China of corruption during much of 2017.

Guo will no doubt invoke Wednesday’s ruling in the Pacific Alliance lawsuit in the other proceedings pending against him in New York. Ironically, in his ruling Judge Ostrager invoked a lawsuit that Guo himself had filed against UBS in New York seeking $500 million he lost in a UBS margin call. Judge Eileen Bransten dismissed that case, saying a New York court was an inappropriate forum for an investment that was negotiated and took place in Hong Kong.

“The court correctly ruled that parties cannot simply drag Mr. Kwok into the New York courts for cases that have no connection to this state,” said Josh Schiller, Guo’s lawyer, in a statement. Guo also sometimes uses the name Miles Kwok.

In Wednesday’s ruling, Judge Ostrager also dismissed the Pacific Alliance hedge fund's effort to seize Guo’s luxurious apartment in Manhattan’s Sherry-Netherland Hotel. Guo is trying to sell the apartment.

A lawyer for the Pacific Alliance hedge fund told Forbes that the hedge fund will appeal Wednesday’s ruling.