Using the same racketeering statutes that are often applied
in cases against the mafia and drug cartels, the pharmaceutical
company Biovail on February 22 filed a suit in New Jersey court
accusing Steve Cohen's $7 billion SAC Capital Advisors of
engineering and executing an elaborate stock manipulation
scheme in 2003 and 2004 that battered the drugmaker's stock in
an effort to produce profits from short-selling.
Canada's largest drug company is requesting a jury trial and
is seeking $4.6 billion in damages from SAC, which it claims
led a "bear attack" to devalue Biovail's stock and make it a
sitting duck for profitable shorting activity. Also implicated
in the alleged conspiracy and named in the suit are brokers,
independent analysts and other hedge funds.
Prior to 2002, SAC Capital Advisors generated an average
annual return in the...