Marble Ridge Capital brought suit against Neiman Marcus Group and related entities in the District Court of Dallas County, TX, alleging, among other wrongdoings, the company fraudulently transferred approximately $1 billion in assets from its European division for no consideration.

Marble Ridge, a distressed debt investor and a creditor of the company, claimed these assets were stripped from the Group’s insolvent subsidiary Neiman Marcus Group LTD to benefit the private equity firms Ares Management and the Canada Pension Plan Investment Board, which are the beneficial owners of Neiman Marcus.

The transfer was allegedly orchestrated in a two-step self-enrichment scheme orchestrated by Neiman Marcus and the LBO sponsors to loot the company of an asset in order to hinder, delay and defraud creditors of the company.

According to the Dallas News, Neiman Marcus is vigorously disputing these claims and has pointed out that it is not currently in default, with $620 million in cash and borrowings on hand to assist in its debt restructuring.