Hedge Fund’s Debt Note Fraud Claims Against PDVSA Are Dismissed

Hedge fund VR Global Partners LP failed to sufficiently allege Venezuela’s state-owned gas company and related entities engaged in a scheme to defraud investors in Petróleos de Venezuela SA debt notes, a federal judge said Monday.

The hedge fund didn’t sufficiently allege that the defendants started scheming in 2016 to stop making payments closer to 2020, dooming two of the claims, and they didn’t allege that PDVSA acted with the necessary state of mind for liability on a third claim, the US District Court for the Southern District of New York said.

The complaint alleges that PDVSA, PDVSA Petróleo ...