NEW YORK (HedgeWorld.com)–Gotham Investment Management Co. LLC began winding down its hedge funds.

Once known as a feisty hedge fund manager willing to publish long, critical analyses of companies it held bearish positions on, Gotham will go down as another successful hedge fund manager who took a wrong turn and got into a liquidity crunch. According to the Wall Street Journal, the company was burned by a large position as a golf-course operator, as well as by increased redemption requests from its investors. Because Gotham held many illiquid investments, the firm reportedly was seeking cash to meet those requests.

Rather than fight the tide, Gotham apparently is liquidating all investments. Gotham co-founder William Ackman didn’t return phone calls, and a spokesman for the company, Owen Blicksilver, said Gotham officials declined comment.

Only a few weeks ago, Gotham was saber rattling over the credit rating of MBIA Inc., a bond insurance company. Gotham published an in-depth report that concluded MBIA’s triple-A credit rating was too high, which would have serious implications for its ability to do business in the future. MBIA executives disagreed, and suggested that Gotham was potentially breaking the law with its accusations and investment approach. Gotham also may have taken a hit from a long position in Prepaid Legal Services.

Though short-term performance reportedly has not been good, longer term it was, according to the Journal. Among Gotham investors were New Republic publisher Martin Peretz and business management guru and Harvard University professor Michael Porter.

PBarr@HedgeWorld.com