SemGroup Litigation Trust Sues Carlyle/Riverstone, Others

(Reuters) – The SemGroup Litigation Trust has filed a lawsuit against certain investment funds that held interests in SemGroup, in a bid to recover about $56 million paid out as special distributions by the energy marketing company, court papers showed.

The litigation trust alleged in a lawsuit filed Monday that funds managed by Ritchie Capital and Carlyle/Riverstone were paid special distribution payments in excess of $56 million in spite of SemGroup’s balance sheet showing a negative partner equity of $342 million at the time.

The lawsuit said both Ritchie and Riverstone had designees who sat on SemGroup’s management committee.

“Because SemGroup transferred the partnership distributions to the defendants while it was insolvent and because it received no value in exchange, the partnership distributions are constructively fraudulent transfers that are subject to avoidance,” the trust claimed in the suit.

SemGroup, once the 14th-largest privately held U.S. company and parent of SemGroup Energy Partners LP, collapsed in 2008 after Chief Executive Thomas Kivisto lost billions of dollars on unauthorized sales of crude oil options. (Reporting by Santosh Nadgir in Bangalore; Editing by Anthony Kurian)