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Pitt, CMU lawsuit over lost investments on hold

Jason Cato
| Monday, March 2, 2009, 12:00 p.m.

A federal judge has temporarily halted a lawsuit filed by Carnegie Mellon University and the University of Pittsburgh seeking the return of $114 million in lost investments.

U.S. District Judge Terrence McVerry granted a stay in the case, in effect canceling a hearing scheduled for Thursday in U.S. District Court, Downtown.

In granting the Oakland schools' request on Friday, McVerry cited civil lawsuits filed by federal regulatory agencies and federal criminal charges filed Wednesday against California-based Westridge Capital Management, its principals Paul Greenwood and Stephen Walsh, and others accused of misappropriating $554 million of investors' money.

If a federal judge in New York today issues a preliminary injunction against the defendants, lawyers for Pitt and CMU say they would request that McVerry vacate his Feb. 20 temporary restraining order freezing Westridge's accounts and prohibiting it from collecting pay, among other things.

Federal regulators accuse Greenwood and Walsh of raiding the investment fund they ran to buy horses, rare books, collectible teddy bears and other items for personal use. Pitt had invested its $65 million with Westridge since 2002, and Carnegie Mellon $49 million since April.

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