The court-appointed receiver of collapse hedge fund Philadelphia Alternative Asset Management has gone to court to force Man Financial to hand over what he says is $179 million of PAAM money; Man has countered that it was holding to repay harmed investors. Filed in U.S. District Court for the Eastern District of Pennsylvania, the motion by receiver Clark Hodgson charges that Man violated a court order by taking the money, as he tries to gather up all the millions in missing assets. Last month, attorney Therese Doherty, who represents Man, called suggestions that the $179 million belongs to PAAM's estate "ludicrous.... There is no money at all sitting at Man Financial that relates in any way to PAAM."

In other legal hedge news, the defunct hedge fund Canary Capital Partners reportedly has agreed to pay New Jersey $10 million – the third-largest securities settlement in the state – to settle charges that the firm and its managing principal, Edward Stern, engaged in late trading. Stern and Canary have also agreed to be barred from the industry for 13 years.

And in Texas, hedge fund operator Conrad Seghers has sued fund administrator David Thompson; Wael Chehab, president of New York-based hedge fund Cedar Capital Management; and James Alban-Davies, director of Bermuda-based hedge Concerto Capital, for allegedly improperly taking control of Integral Hedging Offshore.