The Bulldog Decision: Implications for Hedge Fund Managers and the Massachusetts Securities Division

The Massachusetts Supreme Judicial Court’s recent decision in the case Bulldog Investors General Partnership, et al. v. Secretary of the Commonwealth has significant implications for hedge fund managers and the scope of authority of the Massachusetts Securities Division of the Secretary of the Commonwealth.  In Bulldog, the SJC found that: (1) Bulldog Investors General Partnership, a hedge fund manager, and its principals violated Massachusetts securities laws by offering unregistered securities to a Massachusetts resident via a single e-mail after he registered with Bulldog’s publicly accessible website; and (2) the Securities Division could exercise personal jurisdiction over non-residents Bulldog and its principals in administrative enforcement proceedings.  See “Massachusetts High Court Rules that Website and Single E-Mail Communication to Massachusetts Resident Confer Personal Jurisdiction Over Philip Goldstein’s Hedge Fund Company in Administrative Proceeding,” Hedge Fund Law Report, Vol. 3, No. 28 (Jul. 15, 2010).  In a guest article, Michele Adelman and Catherine Karuga, Counsel and Associate, respectively, at Foley Hoag LLP, explain the factual background of the case and the court’s legal analysis, and offer several take-aways for hedge fund managers.

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