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This article was published 22/2/2019 (364 days ago), so information in it may no longer be current.
Fashion mogul Peter Nygard is attempting to use an American law better known for prosecuting mobsters to hit back at his neighbour in the Bahamas.
Nygard earlier this week filed a complaint with the U.S. federal court in Manhattan alleging hedge fund manager Louis Bacon violated sections of the Racketeer Influenced and Corrupt Organizations Act – better known as the RICO Act.
Meanwhile, a warrant for Nygard’s arrest from a Bahamian court remains in force for his repeated failure to attend hearings down there on contempt charges. Nygard is appealing the warrant.
Court documents filed Feb. 19 with the U.S. federal court in Manhattan state Nygard alleges Bacon hired private investigators to find and bribe witnesses in 2015 and 2016 to testify that Nygard had "prepared a hit list to murder" several individuals, had hired individuals to commit arson, and other criminal activities.
The RICO complaint appears to be an extension of a lawsuit and counter-suit from 2016 between Nygard and Bacon and other legal actions in the U.S., which allege similar wrongdoing. The lawsuits are part of an ongoing dispute between the two men over how Nygard expanded his island property using illegal dredging.
A spokesman for Bacon told the Free Press Nygard’s claims in the RICO complaint are baseless and have been dismissed by the courts previously.
"It is unfortunate that Peter Nygard insists on burdening the courts by repeatedly repackaging and recycling these baseless claims, when nearly identical claims have already been dismissed," Bacon’s spokesman said. "This new suit is just more of the same from Mr. Nygard, who tries again and again to smear his victims with outrageous legal claims that end up going nowhere."
There is an outstanding arrest warrant for Nygard, 78, after he failed to appear for sentencing in Nassau, Bahamas, on Jan. 28 for two counts of contempt of court for failing to comply with court orders prohibiting any further dredging activities.
Statements made to the Nassau court said Nygard was too ill to travel. Evidence presented at the Jan. 28 hearing included photographs of Nygard wearing what appears to be a hospital gown while being attended to by physicians at St. Boniface General Hospital.
Nygard has already been convicted and fined $50,000 for an earlier breach of the injunction, issued in July 2013, against any further dredging operations at the property. That fine is being appealed. Nygard has subsequently been convicted for two additional breaches of the injunction, which is the subject of the arrest warrant.
The RICO complaint ratchets up the dispute between the two men. While the American legislation was originally passed by Congress to target mob bosses who direct criminal organizations, today RICO is more commonly used by persons who claim to be injured by criminal activity.
Successful plaintiffs in civilian RICO complaints are awarded triple damages and all attorneys’ fees and costs.
Minneapolis-based lawyer Jeffrey Grell, who teaches RICO at the University of Minnesota School of Law, said the allegations made by Nygard may survive a motion to dismiss but said the standards are high for civilian cases and questions whether the RICO claim will ultimately succeed.
"The complaint describes the type of conduct that RICO was meant to address. Bribery of a witness is a very serious offence," Grell said, but added that "RICO applies to long-term conduct or conduct that threatens to extend for a long period of time (but) most of the allegations in the complaint occurred in 2015 and 2016," Grell said. "I’m not sure this conduct went on for a long enough period of time. I think that’s their biggest problem."
Grell said Bacon has 21 days to respond to the complaint once he’s been served, adding that Bacon will likely answer the complaint and deny the allegations or bring a motion to dismiss the complaint.
"This seems to be a dispute that has been going on for a long time, with a long history between two very wealthy people," Grell said. "This just seems to be another round in this litigation. If I were a judge, I want these guys to come to some sort of resolution or figure out a way to bury the hatchet so they’re not repeatedly burdening the court system."
Aldo Santin is a veteran newspaper reporter who first carried a pen and notepad in 1978 and joined the Winnipeg Free Press in 1986, where he has covered a variety of beats and specialty areas including education, aboriginal issues, urban and downtown development. Santin has been covering city hall since 2013.