The legal drama surrounding Apollo founder and longtime CEO Leon Black (who abruptly left the firm last year following accusations of abuse levied in the courts by an ex-girlfriend) is reaching absurd new dimensions as Black and his legal team have come forward with a bombshell allegation: In a recent court filing, Black alleged that his former business partner, Apollo co-founder and fellow billionaire Josh Harris, has been pulling strings in the shadows to orchestrate Black's undoing, and the character assassination that has seen Black's name dragged through the mud, forcing him out of roles like his chairmanship of the Museum of Modern Art.
Bloomberg private equity reporter Heather Perlberg expounded on these latest developments in a story published Thursday which was based mostly on court filings from Black's legal team (the billionaire is fighting a civil lawsuit filed by an ex-girlfriend and longtime mistress who has accused him of sexually abusing her). In his latest filings, Black lays out a conspiracy that he alleges is being orchestrated by Harris and PR maven Steven Rubenstein.
Black alleges that the two are using Black's former mistress, Guzel Ganieva, as part of a "coup and smear campaign" in an effort to install Harris as Apollo's CEO. If that is the case, Harris's efforts were unsuccessful, since Harris has also departed Apollo and is starting a new PE venture of his own.
While Ganieva initially accused Black of sexual assault (despite admitting that they had a consensual sexual relationship for more than half a decade, and that he had lavished her with gifts) she later expanded her lawsuit to claim that she had also been "trafficked" by Epstein at Black's behest.
In the late-Tuesday filing, Black's attorneys claimed that Harris has worked with Rubenstein to seed stories in the media about Black's business ties with Jeffrey Epstein (whom Black paid $158MM for "tax advice", a payment that many have insinuated was the result of extortion). It also accused them of using Ganieva as part of their scheme. Now, Black's team is demanding phone records from Harris and Rubenstein that could "show communication between Ms. Ganieva's camp and Mr. Rubenstein's camp - between his accuser and the public relations team that works for his arch-rival - further demonstrating that Ms. Ganieva's claims are nothing but fabrications stitched together from whole cloth."
"It is not a stretch to infer that someone with very deep pockets is supporting her and/or this lawsuit. Mr. Black is entitled to probe and prove up that inference," Black's lawyers added.
Black's lawyers have subpoenaed Verizon for data on all of Rubenstein's calls and texts over the past 12 months. In a motion to quash the order, Rubenstein's lawyers said that "[a]ny private citizen should be aghast that [a bystander to a lawsuit] could be made the subject of a subpoena calling for all their telephone records simply at the whim of a litigant," Rubenstein’s lawyers wrote in a motion to quash the order that was cited by the FT.
Ganieva's lawyers have dismissed Black's claims about her lawsuits being supported by his enemies as "pure speculation". Both Black and Ganieva have filed tit for tat civil complaints with the Supreme Court of the State of New York.
Meanwhile, a representative for Harris, reached Wednesday, called the accusations "desperate and absurd."
"Mr. Harris does not know Ms. Ganieva, has never met or spoken with her or anyone representing her, has no financial or any other dealings with her or her representatives, and had no involvement of any kind in the filing of any claims by her. Simply put, Mr. Harris has nothing whatsoever to do with the deeply troubling situation Mr. Black finds himself in, and any statement or implication otherwise is unhinged at best."
According to Bloomberg, Harris blamed Black for maneuvering Marc Rowan into the CEO's chair at the private equity giant.
The question now is what kind of collateral damage will result from this feud between two billionaires. Already, both Black and Harris have left the extremely successful firm that they helped to create. Both of their reputations have suffered (although Black has clearly taken the brunt of this damage).
Could their fortunes, along with their standing in polite society, also be at risk?
At the very least, the whole escapade could provide grist for the next season of "Billions".