Citadel has accused rival hedge fund Marshall Wace of obstructing a court-ordered document search as the firms continue to clash over the recruitment of former Citadel portfolio manager Daniel Shatzm, according to a report by Bloomberg.
In a filing with a New York court, Citadel alleged that Marshall Wace had failed to fully comply with subpoenas for records relating to Shatz’s 2024 move to the London-based hedge fund, where he became global head of credit.
Citadel is separately engaged in arbitration with Shatz, who claims the firm improperly withheld an eight-figure deferred compensation package following his departure. Citadel argues that Shatz forfeited the payment by breaching his employment agreement and misappropriating confidential information before leaving.
A New York judge ruled in June that Citadel could obtain records from Marshall Wace relevant to its arbitration with Shatz.
Citadel told Justice Andrea Masley that Marshall Wace had spent nearly three months delaying access to evidence and accused the firm of a deliberate effort to “stonewall” its requests.
The hedge fund is seeking an order requiring Marshall Wace to include senior executives Anthony Clake and Alan Hofmeyr in the document search. It also wants the scope of the search terms expanded to capture additional communications concerning Shatz’s recruitment and the creation of Marshall Wace’s credit operation.
Marshall Wace reportedly declined to comment. Lawyers representing the firm said in correspondence cited by Citadel that it had responded to the subpoenas “with diligence and good faith”.
According to Citadel, Marshall Wace has refused to search communications involving Clake and Hofmeyr, despite the executives allegedly playing a central role in hiring Shatz and developing the firm’s new credit team.
Marshall Wace has argued that the two executives are among its most senior leaders and work for a separate UK entity, while questioning whether their communications would contain information uniquely relevant to the arbitration.
The dispute stems from Shatz’s departure from Citadel. He initiated arbitration alleging that the firm retaliated against him after he raised concerns about potential securities violations, including by withholding his deferred compensation.
Citadel has countered that Shatz violated his employment terms by accessing proprietary material before his departure. The firm alleges that after securing his position at Marshall Wace, but before resigning in June 2023 and entering a 15-month gardening leave period, Shatz accessed and printed confidential documents.
Citadel says those materials included recruitment lists, plans for developing a global credit business and candidate evaluation scorecards.
