Representative Cases/Clients
I. Complex & High Stakes Litigation
Currently lead trial counsel for the post-confirmation Syntax/Brillian Corporation Liquidating Trust arising out of this former publicly traded HDTV television manufacturer's losses in the hundreds of millions of dollars. Cross-border international claims are being investigated and pursued against a multitude of financial institutions, corporations and professional firms in the federal courts of Los Angeles, Delaware and Arizona as well as Taiwan and China.
Served as lead trial counsel to Mercury Air Group, a publicly traded airline transportation company, in the state and federal court courts of Los Angeles, California in connection with the defense of securities, unfair competition, antitrust, breach of contract and other claims arising out of a failed corporate acquisition.
Bankruptcy, Third Party & Professional Liability
Currently lead trial counsel for the post-confirmation USACM Liquidating Trust arising out of the former USA Capital based sub-prime mortgage lending entities in connection with the Trust's investigation and pursuit of litigation claims involving hundreds of millions of dollars in damages in the federal courts of Las Vegas, Nevada. These claims and recoveries involve major financial institutions, corporations, accounting and legal professional organizations and other third parties.
Currently lead trial counsel for the post-confirmation Syntax/Brillian Corporation Liquidating Trust arising out of this former publicly traded HDTV television manufacturer's losses in the hundreds of millions of dollars. Cross-border international claims are being investigated and pursued against a multitude of financial institutions, corporations and professional firms in the federal courts of Los Angeles, Delaware and Arizona as well as Taiwan and China.
Currently lead trial counsel for the Creditors Committee in the Appalachian Fuels LLC and related company bankruptcies in the Eastern District of Kentucky in connection with the investigation and pursuit of claims arising from this coal mining company's losses of more than one hundred million dollars. Claims involve a multitude of companies, former officers and directors, insurers and professional firms.
Currently lead special trial counsel for the Chief Restructuring Officer of Equipment Acquisition Resources, a debtor in bankruptcy proceedings in Chicago, Illinois involving hundreds of millions of dollars in losses arising out of an alleged Ponzi scheme.
Over the past year, Diamond McCarthy has represented Perry Uniontown Ventures I, LLC, the owner of one of the largest landfills in the United States, in a Chapter 11 proceeding in the Southern District of Alabama.
Currently oversee all litigation on behalf of the Chapter 11 Trustee to Dreier, LLP in connection with its complex New York litigation proceedings arising out of Mark Dreier’s Ponzi scheme and related matters.
Currently lead trial counsel for the Cayman Island court-appointed liquidators for two former Cayman Island based companies related to the former Italian international food and dairy conglomerate, Parmalat, in connection with their multi-billion dollar claims in the global MDL proceedings in the United States District Court for the Southern District of New York (along with related proceedings in the courts of Grand Cayman and Milan and Parma, Italy. One of the cases is currently on appeal to the U.S. Court of Appeals for the Second Circuit following trial proceedings. Certain international claims have been settled.
Currently lead trial counsel for the chapter 7 bankruptcy trustee for Endoscopy Centers of Nevada in connection with the prosecution and defense of various claims arising out of this high media profile bankruptcy and its related litigation proceedings in which hundreds of lawsuits are pending involving the hepatitis C infections of patients treated by the Debtor. These matters involve hundreds of millions of dollars in claims pending in the courts of Las Vegas, Nevada.
Served as lead trial counsel for the pre- and post-confirmation trustee of LJM2 Co-Investment, LP, the former Enron affiliate led by Andrew Fastow that resulted in Enron's demise, in connection with the investigation and pursuit of millions of dollars in claims arising out of Enron and LJM2's bankruptcy proceedings in Dallas and New York. Substantial recoveries were achieved.
Served as lead trial counsel for more than 1,000 Latin American investors in connection with claims for accounting and legal professional liability, officer and director liability and financial institution tort liability of more than $350 million in damages arising out of the InverWorld, Inc. bankruptcies in the courts of San Antonio, Texas, the Grand Cayman Islands and the United Kingdom. Substantial recoveries were achieved.
Served as lead trial counsel to the post-confirmation trustee of Agribiotech, Inc., the former Las Vegas, Nevada publicly traded forage and seed manufacturing company (largest in North America at the time) in connection with officer and director breach of fiduciary duty claims, software implementation breach of contract claims, accounting and other professional negligence and fraudulent transfer claims in the United States District and Bankruptcy Courts in Las Vegas involving more than $80 million in damages.
Served as lead special trial counsel to the post-confirmation liquidation trust for Southeast Bancshares. At the time Southeast Bancshares was the sixth largest bankruptcy in United States history. Successful claims were prosecuted in the federal courts of Miami, Florida resulting in recoveries against former officers and directors, professional accounting and law firms, and various financial institutions. This is the most successful chapter 7 estate in terms of recoveries and payouts in U.S. history.
Served as lead trial counsel to Tricontinental Industries, a publicly traded company based in Vancouver, Canada in connection with securities fraud, negligent misrepresentation and other claims arising out of Chicago based Anicom, Inc.'s demise in the federal courts of Chicago, Illinois.
Represented the Chapter 7 Trustee for Precept Business Services, Inc. in bankruptcy litigation (N.D.Tex.) against the officers, directors and professionals of the Precept Debtors. In that litigation, the team prosecuted not only the usual estate and generalized creditor claims, but also pressed secured lender claims that had been assigned to the estate.
Acted as Special Counsel to the Creditors Committee in the Friede Goldman Halter bankruptcy (S.D.Miss.), and to its successor liquidating trust. In that role, the firm was charged with investigating and, where appropriate, prosecuting litigation against the officers, directors and professionals who once served the Friede Goldman companies. Major actions brought against certain former officers, directors, and professionals were successfully concluded.
Diamond McCarthy successfully prosecuted, on behalf of Jewel Recovery, L.P., the Zale Jewelers post-confirmation litigation entity, those causes of action held by one of the world's largest jewelry companies and its creditors. This engagement involved the management of hundreds of suits in bankruptcy and other courts in the U.S. and Canada, and the resolution of complex questions of liability and damages relating to company officers and directors, the professionals who served them, and their insurers.
Counsel to minority shareholder against the majority shareholder and nominally against the closely held corporation for minority shareholder oppression, breach of contract, derivative claims against the majority shareholder for misuse of corporate assets and several other related claims. The minority shareholder was successful on all claims presented to the jury. The jury found oppression and that the majority shareholder had acted against the interests of the company. Final judgment was recently entered -- requiring the company to pay an $85 million dividend, back-pay to the minority shareholder, reimbursement to the corporation as well as attorneys fees on the contract claims and the derivative claims brought against the majority shareholder.
Counsel to the Official Committee of Unsecured Creditors of the Millennium Multiple Employer Welfare Benefit Plan, a purported section 419A(f)(6) plan with approximately $112 million in assets that the IRS has declared to be an abusive tax shelter.
In the Livent litigation and bankruptcy (S.D.N.Y.), Diamond McCarthy lawyers brought: (1) a securities fraud class action on behalf of institutional and individual noteholders of the notes of Livent, Inc.; and (2) a parallel and reinforcing equitable subordination action against Livent's lead lender, on behalf of the Creditors Committee. A comprehensive, multi-case settlement with that lender was successfully concluded to the great benefit of the estate and its creditors.
Defense counsel to large gas producing company in a number of proposed class action cases involving the propriety of royalty payments for gas and natural gas liquids production in Texas. The Plaintiffs' claims focused on affiliate sales and the pricing structure of such sales. Classes were certified at the trial court level, but defendants were successful in reversing them on appeal. See See, e.g., Union Pacific Resources Group v. Hankins, 111 S.W.3d 69 (Tex 2003); Union Pacific Resources v. Neinast, 67 S.W.3d 275 (Tex. App.- Houston [1st Dist.] 2001, pet. denied)
Defense counsel to second largest gas producer in the state of Michigan in a proposed class action involving the propriety of royalty payments for gas and natural gas liquids production. Plaintiffs' claims focus on affiliate sales, the pricing of such sales, and the deductions taken therefrom in the calculation of royalty payments. After first reversing a default judgment taken prior against the company prior to involvement of attorneys, the first also reversed the trial court's certification of a royalty owner class. Upon securing the reversal, plaintiffs' counsel agreed to dismiss the case with prejudice.
Currently lead counsel in a lawsuit (D. Nev.) against multinational mining companies alleged to have caused severe injuries to the environment and economy of the Philippine island province of Marinduque, and to its people.
Representation of a large multinational oil and gas pipeline company in a dispute involving the threat of disconnection of gas pipelines in the Gulf of Mexico against another pipeline company and some of the largest oil and gas producers in the world.
Served as lead counsel in a lawsuit alleging that a major international oil company made illegal payments to certain Asian governmental officials in order to preclude a rival from securing lucrative oil and gas contracts in that nation's offshore areas. The case has involved proceedings in the Texas and D.C. federal district courts, the Fifth Circuit and the United States Supreme Court.
Defense counsel to large gas producing company in a number of proposed class action cases involving the propriety of royalty payments for gas and natural gas liquids production in Texas. The Plaintiffs' claims focused on affiliate sales and the pricing structure of such sales. Classes were certified at the trial court level, but defendants were successful in reversing them on appeal. See e.g., Union Pacific Resources Group v. Hankins, 111 S.W.3d 69 (Tex 2003); Union Pacific Resources v. Neinast, 67 S.W.3d 275 (Tex. App.- Houston [1st Dist.] 2001, pet. denied)
Defense counsel to large oil producing company in an action brought under the False Claims Act, 31 U.S.C. § 3729, et seq. in the United States District Court for the Eastern District of Texas. The case was originally filed by private relators on behalf of the United States under the qui tam provisions of the False Claims Act. The Plaintiffs alleged that the defendant oil companies had engaged in numerous schemes, and had filed hundreds of thousands of false reports with the Department of Interior, with the intent to underpay royalties on crude oil extracted from federal and Indian lands.
Defense counsel to second largest gas producer in the state of Michigan in a proposed class action involving the propriety of royalty payments for gas and natural gas liquids production. Plaintiffs' claims focus on affiliate sales, the pricing of such sales, and the deductions taken therefrom in the calculation of royalty payments. After first reversing a default judgment taken prior against the company prior to involvement of attorneys, the first also reversed the trial court's certification of a royalty owner class. Upon securing the reversal, plaintiffs' counsel agreed to dismiss the case with prejudice.
Defense counsel to large independent natural gas producer in cases brought by landowners in/near Fort Worth, Texas. Plaintiffs alleged that the industry players in the area (including our client) conspired against landowners/prospective royalty owners to drive down the price of bonus payments and royalties. Defendants (producers, brokers and related industry players) moved to dismiss the case based standing/lack of subject matter jurisdiction grounds. The judge recently granted defendants motion and dismissed the antitrust claims.
Representation of a natural gas producer in connection with the terms of a gas sales agreement. The issues included the construction of contractual language, whether terms were enforceable and whether there was to be an equity kicker/upside, and the effect of the juries answer to several questions. The case (which was litigated in Texas although the production was in Michigan) was ultimately settled after the producer rescinded the contract based upon the jury findings and cross appeals were filed.
Currently lead trial counsel for various New York and Boston based hedge funds in connection with credit default derivative swap (CDO) contract litigation claims arising out of the American Home Mortgage Company bankruptcy proceedings against one of the largest global U.S. financial institutions pending in Delaware federal court.
Served as lead trial counsel to global Dutch bank, Rabobank Netherlands, in connection with parallel international proceedings involving more than $100 million in claims against another international European bank, former officers and directors of an international dry fruits and nuts processor as well as cross-border accounting and audit malpractice litigation against one of the big four accounting firms in Contra Costa County, California, Fresno, California and London, England.
Currently lead trial counsel for the post-confirmation Syntax/Brillian Corporation Liquidating Trust arising out of this former publicly traded HDTV television manufacturer's losses in the hundreds of millions of dollars. Cross-border international claims are being investigated and pursued against a multitude of financial institutions, corporations and professional firms in the federal courts of Los Angeles, Delaware and Arizona as well as Taiwan and China
Served as lead trial counsel for more than 1,000 Latin American investors in connection with claims for accounting and legal professional liability, officer and director liability and financial institution tort liability of more than $350 million in damages arising out of the InverWorld, Inc. bankruptcies in the courts of San Antonio, Texas, the Grand Cayman Islands and the United Kingdom. Substantial recoveries were achieved.
Served as lead trial counsel to global Dutch bank, Rabobank Netherlands, in connection with parallel international proceedings involving more than $100 million in claims against another international European bank, former officers and directors of an international dry fruits and nuts processor as well as cross-border accounting and audit malpractice litigation against one of the big four accounting firms in Contra Costa County, California, Fresno, California and London, England.
All of the firm's current Qui Tam cases are under seal. For further information, please contact Robert Sadowski at 212.430.5407 or rsadowski@diamondmccarthy.com
Securities & Regulatory Issues
The New York office defended a significant number of the partners of Van der Moolen Specialists, then the second largest specialist firm trading on the floor of the New York Stock Exchange, from 2003 through 2009 in connection with alleged violations of the federal securities laws and the Rules of the Stock Exchange. Our representation involved the administrative and criminal investigations and proceedings against traders at the five major specialist firms and included total vindication of several of our clients. We negotiated settlements after extensive discovery proceedings for several other clients with the Stock Exchange and the SEC. We represented three partners in an extremely complex, 42 day multi-respondent administrative trial before the SEC Chief Administrative Law Judge, which resulted in no fines assessed against our clients. On behalf of several partners, we negotiated with the United States Attorney for the Southern District not to indict them for securities fraud. Three of our clients were indicted. After two separate jury trials, in which we assisted criminal counsel, our clients were found not guilty and the charges against the third were dismissed.
Served as lead trial counsel to Tricontinental Industries, a publicly traded company based in Vancouver, Canada in connection with securities fraud, negligent misrepresentation and other claims arising out of Chicago based Anicom, Inc.'s demise in the federal courts of Chicago, Illinois.
Served as lead trial counsel to Mercury Air Group, a publicly traded airline transportation company, in the state and federal court courts of Los Angeles, California in connection with the defense of securities, unfair competition, antitrust, breach of contract and other claims arising out of a failed corporate acquisition.
In the Livent litigation and bankruptcy (S.D.N.Y.), Diamond McCarthy lawyers brought: (1) a securities fraud class action on behalf of institutional and individual noteholders of the notes of Livent, Inc.; and (2) a parallel and reinforcing equitable subordination action against Livent's lead lender, on behalf of the Creditors Committee. A comprehensive, multi-case settlement with that lender was successfully concluded to the great benefit of the estate and its creditors.
Representation of a minority shareholder and co-founder of a Dallas bank software company alleging claims for minority shareholder oppression, breach of fiduciary duty, fraud and breach of an employment agreement. After a six week jury trial in Dallas State District Court in November 2009, a the Court entered a Final Judgment in March 2010, which awarded a mandatory, Court-ordered dividend of $85 million to the company's shareholders, out of which the firm's client would have received his 47% ownership interest, as well as more than $4 million in back pay, legal fees and accrued interest. On appeal, the Dallas Court of Appeals reversed all relief granted in the District Court’s Final Judgment in August 2011, and a Petition for Writ of Error has been filed with the Texas Supreme Court.
II. Business Insolvency & Restructuring
Represented the Chapter 7 Trustee for Precept Business Services, Inc. in bankruptcy litigation (N.D.Tex.) against the officers, directors and professionals of the Precept Debtors. In that litigation, the team prosecuted not only the usual estate and generalized creditor claims, but also pressed secured lender claims that had been assigned to the estate.
Debtors' counsel for Consolidated Equipment Companies, Inc., Con-Equip, Inc. and Owsley & Sons, Inc. as debtors in possession, representing the largest commercial crane retailers in the southeastern United States, with over $100 million in senior secured debt in their Chapter 11 bankruptcy cases. Important issues included prepetition planning, debtor in possession financing, cash collateral, 363 asset sales and plan formulation and confirmation.
Debtors' counsel for Consolidated Roofing and Waterproofing, Inc. and eleven related companies as debtors in possession in Chapter 11 bankruptcy cases and representing this nation-wide network of commercial roofing companies from pre-bankruptcy planning through plan confirmation. Diamond McCarthy handled issues related to construction project bonding and surety issues, enforcing the automatic stay, secured creditor negotiations, and 363 asset sales.
Debtor's counsel for AFG Pacific Properties, Inc. as debtor in possession in Chapter 11 bankruptcy case and representing this international real estate holding company in the sale of over $30 million in undeveloped real estate through a Chapter 11 plan of reorganization.
Counsel for the Official Committee of Unsecured Creditors of PJJ Management Corporation and its affiliates and general bankruptcy counsel for the unsecured creditors committee in the Chapter 11 cases of these specialty engineering and manufacturing debtors. Issues included contesting cash collateral and plan confirmation, investigating claims against the debtors' officer and directors and certain secured creditors and negotiating and obtaining improved treatment for unsecured creditors in the debtors' Chapter 11 plan of reorganization.
Counsel for the Official Committee of Unsecured Creditors of Logix Communications Corporation, representing the unsecured creditors committee in the Chapter 11 bankruptcy of this telecommunications competitive local exchange carrier in Texas, Louisiana, Oklahoma and Florida. Case issues included investigating lien avoidance and debt recharacterization claims, making a Louisiana World demand to allow the unsecured creditors committee to bring claims on behalf of the debtor's estate, negotiating the recovery for, and protecting the interests of unsecured creditors.
With respect to foreign institutional investors, we have represented Oxford Properties Group, an affiliate of the Ontario Municipal Employees Retirement System, and the Canada Pension Plan Investment Board in connection with their investments in real estate funds and joint ventures with respect to the acquisition and development of properties in the United States.
