US judge narrows Bacon-Nygård defamation case tied to Bahamas fire

Fri Jul 31, 2015 2:22pm EDT
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By Joseph Ax

NEW YORK, July 31 (Reuters) - A New York judge has narrowed the scope of a $100 million defamation lawsuit filed by billionaire hedge fund manager Louis Bacon against Canadian fashion designer Peter Nygård, part of a bitter dispute over neighboring properties they own in the Bahamas.

In a decision made public on Friday, Justice Cynthia Kern in State Supreme Court in Manhattan dismissed 105 of the 135 allegedly defamatory statements that formed the basis for Bacon's $100 million lawsuit in January, accusing Nygård of orchestrating an "obsessive" smear campaign.

Bacon, the founder of Moore Capital Management, can continue to pursue the remaining defamation claims.

Nygård, for his part, filed a $50 million countersuit in April accusing Bacon of a "vendetta" against him, including harassment and frivolous litigation. Bacon's lawyers have asked Kern to throw out Nygård's claims.

Each man has denied the other's allegations.

The fight stems from Bacon's opposition to Nygård's plans to rebuild his estate in their gated Bahamas community, following a 2009 fire. Bacon has said the work could harm the environment.

In his countersuit, Nygård claimed that Bacon may have prompted a groundskeeper to set the fire. Bacon has denied any role in the fire.

Bacon's lawsuit accused Nygård of falsely linking him to drug smuggling, insider trading and the Ku Klux Klan.   Continued...