Hedge Funds

Baker Botts’ Alternative Investments Practice combines the traditional strengths of the firm with lawyers who have significant industry experience, including the former general counsel of a large hedge fund manager. Our practice represents institutional investors across a broad range of asset classes, investment managers in transactional and other matters, and alternative investment funds in a broad range of activities through their life cycle.

Manager Representation:

We have assisted hedge fund managers in a range of business ventures, such as the negotiation of seed capital arrangements; the restructuring of cross-border activities to achieve internal control and regulatory and tax efficiencies and the acquisition of new investment strategies through employment, business acquisitions and joint ventures. We advise private investment firms in the acquisition of interests in hedge fund managers and other advisory entities. We have also represented public companies and their boards of directors in connection with their consideration of proposed transactions for investment managers.

Our industry experience helps our clients navigate the various regulatory regimes applicable to participants in the investment management area, particularly the interplay of investment advisor and broker-dealer regulations.

Fund Representation:

We have helped launch a broad range of investment funds with investors within the United States and throughout the world. This practice has emphasized the creation of investment products, both private and public, as well as the establishment of more traditional private investment funds.

We advise clients in connection with the development of investment funds in atypical assets, including funds focusing on currencies, emerging or developing markets, the energy sector, carbon emission credits and offset projects, minerals and mining rights and investments related to timber, water and water rights. Our lawyers have advised fund sponsors of more traditional single-strategy hedge funds which have included global macro, fixed-income arbitrage, risk arbitrage and long-short equity strategies. Multi-strategy funds have included funds of funds, as well as single-manager multi-strategy funds.

Compliance and Enforcement Matters:

Baker Botts assists investment advisers, commodity pool operators and commodity trading advisors with the design and operation of their compliance and internal control programs. We represent these firms in routine regulatory audits, as well as in responding to regulatory assertions of deficiencies and formal or informal investigations. Our experience with trading and trade reporting issues has been helpful for the resolution of regulatory matters for investment banking, broker-dealer and individual clients.

Contested Matters:

We work closely with our Litigation Practice to advise investors, investment advisers and their professionals regarding actual or potential disputes and litigation involving hedge funds, private equity funds and their managers. In particular, we have significant experience representing liquidators of hedge funds. We believe our experience in the asset-management field provides insight and allows us to find creative and efficient solutions to potential problems. Our cross-disciplinary approach allows us to assess and navigate the complex issues that can arise during the liquidation process.

Commodities and Derivatives:

Our lawyers routinely deal with regulatory and other issues that arise in connection with investments in futures and commodity related investments. We also assist our clients regarding the structuring and documentation of derivatives transactions. Our lawyers have assisted in the establishment of prime brokerage and other trading relationships. A focus of our Practice is advising clients in connection with assessing and managing counterparty risk.