Newark, New Jersey-based Blueprint Capital Advisors, the prominent Black-owned asset manager with $1.6 billion in assets, announced today it will get a court date on a longstanding federal lawsuit filed against multiple financial powerhouses, including asset management giant BlackRock. Black Enterprise reviewed court issued documents and was granted an exclusive interview with CEO Jacob Walthour.
U.S. District Judge Julien Xavier Neals mostly denied a motion to dismiss Blueprint’s suit, according to the 102-page court decision. “At this point in the litigation, the Court is satisfied that it may be inferred from the allegations that Defendants through their concerted actions engaged in a pattern of racketeering activity.” His decision came after the original 300-page complaint filed against BlackRock, Owl Rock, and several New Jersey officials, including Gov. Phil Murphy, DOI, and Cliffwater.
Generally, racketeering can involve acquiring business through illegal activity including fraud and bribery, operating a business with illegally derived income, or using a business to commit illegal acts or an illegitimate scheme.
Blueprint claims that BlackRock Inc., reportedly the world’s largest asset manager with just under $8 trillion in total assets, and Owl Rock Capital (now BlueOwl Capital Inc.), with about $65.7 billion in assets plotted with officials in the state to misappropriate its proprietary product.
Blueprint has alleged that it submitted confidential information about its plan to New Jersey’s Division of Investment and Cliffwater L.L.C., the agency’s outside consultant. Blueprint charges the state took the plan and colluded with BlackRock and Owl Rock alternatively, allowing the trio to benefit from the plan.
Blueprint CEO Jacob Walthour says the judge’s decision blocks the defendants’ attempt to have the suit thrown out and permits Blueprint to have the case heard in federal court. He says the discovery and depositions are in the planning stages, and Blueprint hopes a trial court date will be set shortly after those processes conclude.
Neals discarded several claims against Murphy and the state, maintaining they were immune from the suit as government officials, according to an earlier report by Bloomberg.
Walthour further made allegations that the officials managing New Jersey’s pension fund have a pattern of using the state’s assets for their own personal benefit at taxpayers’ expense. “It’s time for BlackRock and Owl Rock to have to play by the rules.”
According to the Bloomberg report, BlackRock company spokesperson Dominic McMullan stated, “We continue to believe the lawsuit has no merit and we are confident that we will prevail in this dispute.”
Blueprint claims in its complaint that BlackRock and Owl Rock benefited from an “old-boy” network in the DOI to secure hundreds of millions of dollars in investment at Blueprint’s expense.
Moreover, Walthour hopes the case will abolish the “old-boys network” in the financial services sector and create new opportunities for diverse firms.
