23 March 2007
23 March 2007 - A group of Mayer, Brown, Rowe & Maw LLP lawyers played a significant role in Wednesday's Florida District Court of Appeal ruling, reversing a previous jury award of $1.58 billion, including $850 million in punitive damages, to billionaire Ronald Perelman's company, Coleman (Parent) Holdings ("CPH"). CPH had sued Morgan Stanley over the 1998 sale of Coleman Co., in which it was the majority shareholder, to Sunbeam Corp. Mayer, Brown, Rowe & Maw was one of the lead firms helping to set the appellate strategy and draft the appellate briefs on behalf of Morgan Stanley. Mayer, Brown, Rowe & Maw took the lead on punitive damages issues.
A jury had ruled in CPH's favor in May 2005, after having been told, as a sanction for alleged discovery misconduct by Morgan Stanley, to assume that the investment bank had conspired with Sunbeam to defraud Perelman by paying for the merger in part with substantially overvalued Sunbeam stock. In a 2-1 decision, Florida's Fourth District Court of Appeal in West Palm Beach said CPH failed to prove that it was damaged. CPH sought benefit-of-the-bargain damages but presented no evidence of the stock's value absent the fraud-an essential component of benefit-of-the bargain damages. The court thereupon ordered judgment to be entered in Morgan Stanley's favor.
The Mayer, Brown, Rowe & Maw team was comprised of New York partner Andy Frey, New York associate Scott Chesin, and Washington, D.C. associate Nick Levin.
This victory comes in the wake two successful arguments to the U.S. Supreme Court by Mayer, Brown, Rowe & Maw attorneys. Decisions favorable to Mayer, Brown, Rowe & Maw clients both were announced last February 20. In one case, the Court ruled 5-4 on behalf of Philip Morris USA in Philip Morris USA v. Williams, a ruling expected to impose new curbs on the use of punitive damages across the country. The second case, Weyerhaeuser Co. v. Ross-Simmons Hardwood Lumber Co., held that the same standard that the Court articulated for predatory-pricing cases applies in cases alleging predatory buying, vastly limiting the availability of predatory-buying claims. The Court ruled unanimously in favor of Weyerhaeuser.
For more information on these cases and Mayer Brown's Appellate Practice Group, please visit www.appellate.net