6:22pm PT by Ashley Cullins
Ryan Kavanaugh Hit With Fraud Suit From Relativity Investor
Ryan Kavanaugh is facing another lawsuit involving Relativity's 2015 financial collapse.
Hedge fund investor Carey Metz says Kavanaugh duped him into lending $2 million, according to a lawsuit filed Thursday in Los Angeles County Superior Court.
"Kavanaugh desperately needed money to save Relativity from bankruptcy and to save his reputation and lifestyle," writes attorney David Bovino. "Kavanaugh lied about Relativity's financial condition, he lied about the existence of other investors, and he lied about the size of other investments to induce Metz to make a bridge loan to Relativity."
Metz says the CEO convinced him that the second $2 million loan would save Relativity from bankruptcy and thereby protect a previous $10 million investment. He says he agreed on the condition that Kavanaugh agreed to personally guarantee the repayment of the loan and that the repayment would not be dependent on Relativity's performance, according to the complaint.
The investor is suing for fraudulent inducement, breach of oral contract and unjust enrichment, among other claims. The full complaint is posted below.
Reps for Kavanaugh couldn't immediately be reached for comment.