A retired doctor’s class action claim against Sage Rutty & Co. Inc. should be thrown out as the action of a “disgruntled but experienced investor,” lawyers for the Rochester investment firm contend.
Michael Cappette M.D. sued Sage Rutty in June, claiming the firm’s advisers misled him on risks entailed in a private placement for a Florida real estate venture.
A former Rochester resident who is now retired and living in Cyprus, Cappette is seeking damages equal to three times his $50,000 investment in the Florida venture. Sage Rutty is liable for treble damages under the federal Racketeer Influenced Corrupt Organizations Act, Cappette maintains.
In papers filed in July, a Sage Rutty lawyer contends that Cappette’s claim does not describe a pattern of activity sufficient to file a RICO complaint and that if the RICO claim fails, the rest of the suit should also be thrown out.
Cappette claims in his June complaint that a Sage Rutty adviser concealed the investment’s heavy risks and later falsely claimed to adequately inform him of them, but a subscription agreement submitted as part of Cappette’s own evidence shows that the facts were presented to him, Sage Rutty attorney Peter Abdella of Harter Secrest & Emery states in the dismissal motion.
“(Cappette) either knew or should have known as of the date of the Subscription Agreement and Limited Liability Compliance Questionnaire that he was purchasing an illiquid asset with the risk that the principal could be lost,” Abdella states in court papers.
The physician’s class action claims also lack merit because Cappette failed to show that any others are in a similar situation, Abdella adds.
No hearing on the dismissal motion has yet been scheduled.
Cappette plans to file an amended complaint later this month, court records show.
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