David Einhorn’s Greenlight Capital Inc. has intensified its legal battle with former employee James Fishback, who claims to have been head of macro trading at the firm. Greenlight alleges Fishback was a poor performer who resigned to avoid being fired.
In a new lawsuit filed in Manhattan federal court, Greenlight challenges Fishback's claims of generating $100 million in profits and having "insane" performance at the firm. According to the suit, Fishback was merely a research analyst without any control over the firm’s macro portfolio.
Earlier this year, Greenlight sued Fishback for lying about his role, which the firm says breached two promissory notes. The latest suit expands the allegations, accusing Fishback of violating his employment agreement, defaming Greenlight, and engaging in unfair competition. This is the first time Greenlight has detailed its accusations against Fishback, calling his claims false.
“Fishback made these false statements to misleadingly inflate his perceived abilities and responsibilities and to take credit for Greenlight’s track record, goodwill, and reputation,” the lawsuit states.
Greenlight further accuses Fishback of stealing confidential information and engaging in a campaign to “harass, intimidate, and defame” the fund and Einhorn, including filing frivolous litigation and threatening to disrupt its annual partners’ dinner.
Fishback previously filed a defamation lawsuit against Greenlight, claiming the firm falsely told a "preeminent family office" that he was never head of macro, which affected his efforts to attract investors for his own fund, Azoria Partners.
The dispute has also played out on social media, inspiring numerous "head of macro" memes and commentary from prominent investors, including Daniel Loeb of Third Point LLC.
In a statement, Fishback called Greenlight's lawsuit a "desperate ploy" to save face with its investors and promised to respond to each of their allegations in detail.
Fishback, who dropped his defamation suit in January to proceed with arbitration, claims he successfully ran his own hedge fund before joining Greenlight. He says he started consulting on macro investing with Einhorn in 2019 and was hired as a research analyst in 2021. Fishback maintains he was an "outstanding performer," earning more than $100 million in profits and eventually being promoted to head of macro.
Greenlight refutes these claims, stating that Fishback was set to be terminated for lack of productivity but resigned when he learned he was about to be fired. The firm asserts that while Fishback was allowed to execute some macro trades directed by Einhorn, he had no authority to trade independently.
"And, since he had absolutely no authority or discretion whatsoever over Greenlight’s macro investment portfolio, he was not responsible for generating any profits, let alone ‘over $100 million’ of profits,” the complaint states.
Greenlight alleges Fishback originally claimed he was resigning to focus on non-profit work but later changed his story to attract publicity by disparaging Einhorn and promoting Azoria.
Fishback frequently tweets right-wing political opinions and has appeared on podcasts with figures such as Vivek Ramaswamy. He has criticized Einhorn for shorting Tesla Inc., even proposing a public debate on the electric carmaker.
Einhorn declined the debate, stating that his opponent should have knowledge about the subject. Greenlight claims Fishback used this rejection to launch a social media and podcast tirade against the firm, continuing to lie about his role and contributions.
Fishback allegedly threatened to disrupt Greenlight’s partner dinner by handing out letters criticizing the fund’s strategies when denied attendance.
Greenlight, a value-investing fund, has faced challenges in recent years due to the rise of passive investing and algorithmic trading, which Einhorn says have "fundamentally broken" the markets. In the first quarter of this year, Greenlight gained 4.9%, trailing the S&P 500 Index's nearly 11% return. Last year, the fund was up about 22%, compared to the index's 26% rise.
The case is Greenlight Capital Inc. v. James T. Fishback, 24-cv-4832, US District Court, Southern District of New York (Manhattan).
