Hedge Fund Accuses Concord SPAC Backers of Pocketing Breakup Fee

Concord Acquisition Corp.'s sponsors are facing investor litigation over claims they misappropriated a $20 million breakup fee—instead of distributing it to shareholders—after calling off a blank-check merger with a cryptocurrency business.

The lawsuit targets members of the special purpose acquisition company’s board and management, all allegedly with formal or informal ties to Atlas Merchant Capital LLC. It was filed Monday in Delaware’s Chancery Court by Funicular Funds LP, an affiliate of hedge fund sponsor Cable Car Capital LLC.

The case is the latest in a wave of litigation prompted by SPAC mergers, called de-SPACs, which combine a publicly traded entity ...