But by then, he had already moved on from Columbus Nova, after digging into his own pocket to pay rent and other expenses to keep it afloat. He recently rebranded his firm Sparrow Capital, and moved to a smaller office space with just nine of the 25 employees from Columbus Nova.
His lawsuit takes aim at the Treasury Department’s so-called 50 percent rule, a longstanding policy that applies sanctions to an entity — like a Columbus Nova investment fund — in which a person or company under sanctions has at least a 50 percent stake.
Under the rule, Columbus Nova can apply for licenses to perform specific functions, but the suit said that the Treasury Department granted only two of the more than 10 requests made by Mr. Intrater’s lawyers at Latham & Watkins. Even then, the Treasury Department allowed Columbus Nova access to money to pay lawyers and accountants, but not to collect fees and profits.
The lawsuit argues that the 50 percent rule is unconstitutional because it does not prescribe a time period in which the Treasury Department must respond to license requests, nor does it outline how the government should evaluate such requests. Mr. Intrater and his firm, the lawsuit contends, “remain in complete limbo, unable to control, manage, use or dispose of their property.”
Of the blocked assets valued at more than $250 million, $55 million is in cash. Much of that is Mr. Vekselberg’s, but at least $12 million belongs to Mr. Intrater, his partners and the firm, he said. That includes money from the deal involving the Prince heirs, who ended up finding a new lender after the sanctions took effect.
If successful, the lawsuit could break new legal ground. Carlton Greene, a former senior Treasury official who worked in the office overseeing investigations into sanctions violations and is now a partner at Crowell & Moring, said past lawsuits had raised Fourth Amendment issues but none made it a central argument.
“I think a Fourth Amendment argument for property blocked in the U.S., for a party with constitutional rights, is an argument that the government would have to take seriously,” Mr. Greene said.