Distressed Debt Firm Invictus Sues Its Top Investor Over Firing

Distressed debt firm Invictus Global Management sued one of its top financial backers, claiming that private equity investor Gatewood Capital Partners lied about the amount of support it could provide.

The lawsuit, filed in New York state court, comes less than two months after Gatewood and another investor voted to fire Invictus from its job overseeing distressed-debt funds that the specialty fund manager created and developed.

“Gatewood’s apparent modus operandi is to prey on emerging managers by making promises that it has no intention of delivering: the classic ‘bait and switch’ scheme,” Invictus said in the lawsuit.

Invictus, founded in ...