Hedge Fund Appaloosa Denied in Bid to Halt Stuy Town Foreclosure
Eliot Brown April 29, 2010, 1:21 p.m.
“A U.S. judge on Thursday denied a bid by the Appaloosa Investment LP hedge fund to join a lawsuit to foreclose on New York’s massive Stuyvesant Town/Peter Cooper Village apartment complexes.
U.S. District Judge Alvin Hellerstein ruled from the bench after an hour-long hearing on Appaloosa’s motion.
‘There is no proof that it is a defendant and if anything, it is more aligned with the plaintiffs,’ Hellerstein said.
He said Appaloosa ‘is not likely to be impaired or impeded if its intervention is denied.'”
Mr. Tepper, who bought discounted chunks of the troubled property’s $3 billion mortgage, had been warring in the courts with CW Capital–the special servicer firm that is managing the default on the property for the mortgage holders–in an attempt to avert a foreclosure. (More on Mr. Tepper and his quest to make money on Stuy Town in a feature story I wrote a couple weeks back.)
Mr. Tepper, whose risky chunks of the mortgage could stand to be wiped out as a result of a foreclosure, preferred a bankruptcy and reorganization.