The ultimate — and strangest — alternative investment gets a big boost

As alternative investments go, it doesn’t get much more out there than VR Holdings Inc. (VRHD), which is essentially a shell corporation with a 17-year-old lawsuit as its primary asset.
However, depending on your tolerance for mind-numbingly slow legal proceedings and appetite for arcane court battles, the patient investor could find some real upside in what amounts to an investment in a $3.4 billion lawsuit.
That’s the basic premise pitched so enthusiastically by lead plaintiff Morton Lapides, who helped engineer the tactic of providing aging plaintiffs some liquidity by packaging the lawsuit inside a publicly-traded company.
The stock, which was listed in 2009, has maintained a near constant price of 51 cents per share on almost no trading activity.
Of course, the potential in a best-case-scenario legal resolution would make the 460 million outstanding shares worth about $6 each after legal fees and expenses, representing a tidy gain of nearly 1,100%.
Mr. Lapides admits the full return might be shooting for the stars, “but we can certainly half of that return.”
The renewed hope for the 84-year-old two-time cancer survivor comes in the form of two New Orleans law firms that have signed on as lead counsel on a contingency basis: Fishman Haygood Phelps Walmsley Willis & Swanson LLP, and Jones, Swanson, Huddell & Garrison LLC
Neither law firm responded to requests for comment.
“They’re doing this on a contingency basis because they think it’s a good case,” said Mr. Lapides. “We’re hoping the other side will look at it differently now with these two big firms on board, because they have a lot of money and a history of winning big cases.”
The history of this case is nothing if not messy and complex, but it basically boils down to charges that a half-dozen hedge funds and money managers wound up with a majority ownership stake in a company that made concert T-shirts when a six-month $23 million bridge loan was allowed to lapse.
According to Mr. Lapides, the “domino effect” from the failure of T-shirt maker, Winterland Concessions Co., along with three other companies, brought down the parent company MML Inc.
Among the firms listed as defendants in the lawsuit, which also helps explain why the New Orleans law firms are so willing to work on a contingency basis, include Cerberus Capital Management and Gordon Brothers Capital, neither of which responded to requests for comment.
Mr. Lapides is one of 27 claimants in the lawsuit, and he remains determined to right what he views as a wrong and hopefully make some money along the way.
“I think they figure I’ll just die and they won’t have to worry about it anymore, but I already survived both pancreatic cancer and prostate cancer,” he said. “They should be worried, and they should definitely be worried about these two law firms jumping in.”