DISTRESSED DAILY: Hedge Fund Founder Faces Prison in Neiman Case

Marble Ridge Capital founder Dan Kamensky faces the prospect of being the first distressed debt investor in memory to go to prison for abusing his position as the head of a court-supervised bankruptcy committee.

On Friday, U.S. District Court Judge Denise L. Cote will decide how much, if any, time in prison that Kamensky will receive after pleading guilty earlier this year to one count of extortion and bribery related to his actions in the Neiman Marcus Group Inc. bankruptcy case.

Kamensky, 48, was charged by federal prosecutors in Manhattan last year with pressuring a rival to abandon a higher ...