Lender Liability Commercial Litigation

FBBC successfully defends couple personally sued for $2,400,000 by commercial lender. The lender sued the couple seeking $2,400,000 on personal a guarantee agreement they signed. If successful, the suit would have economically devastated the couple. The couple had signed an agreement with the lender in which they guaranteed the debt of a family member’s business. When that business went under, the lender personally sued the couple for recovery of the entire debt, totaling $2,400,000. After a three week jury trial, FBBC obtained a complete exoneration for the couple. FBBC proved that the lender had concealed information from the couple into signing the guarantee by, among other things, withholding key information from them. As a result, the jury found in favor of the couple on all claims, awarding the lender nothing. The couple is now pursuing recovery of all their legal fees and expenses from the lender.

Action against General Electric Credit Company (“GECC”) alleging that GECC interfered with the operations of the borrower, AAI, and tried to “squeeze” the borrowers out of a new company that had successfully passed “First Flight Status” in the design of a corporate jet called the FANSTAR. After trial lasting several months, the jury returned a $65,000,000 verdict plus $5,000,000 in punitive damages against GECC.

Lender contended that FBB&C’s client was in default on loans and threatened to sue. Action initiated by Borrower against the lender for interfering with the borrower’s business and failing to honor commitments. Jury verdict against the bank and in favor of FBB&C’s client.

Tried to a jury in Kingman, Arizona, FBB&C obtained the largest verdict ever awarded in that city. The Lender had allegedly interfered with the operations of a recreational vehicle park, causing damage, but the lender nonetheless claimed to be owed money on its loan. Verdict in favor of FBB&C’s clients and against the Bank.

Filed and tried in Phoenix, Arizona, the jury returned a verdict against the Bank and in favor of FBB&C’s clients based on the Bank’s early termination of credit facilities after Bank of America merged with the local bank. Dubbed by the local press as a case of “Merger in the First Degree,” the case received wide local coverage.

Action against Union Bank where client alleged that the bank terminated credit and interfered with business operations and did so with malice. Pursuant to confidential settlement agreement, client entitled to say that it is exceedingly satisfied with the settlement, but not allowed to report on its size.

Fred Sands Realty (“FSR”), the listing broker in a sale of an ocean front estate in Malibu, sued FBB&C’s client for the full amount of commissions earned. After careful strategic analysis, FBB&C filed a countersuit alleging that FSR had breached certain duties to the client in the sale of the property. FBB&C successfully defeated FSR in pre-trial motions and then tried the client’s case to the jury, who returned a $1,500,000 verdict in favor of FBB&C’s client. While the jury was deliberating on punitive damages, FSR requested a confidential settlement to avoid the full impact of punitive damages. As a condition of settlement, the amount of the settlement paid to the plaintiff is to be kept confidential.

Action by Bank of the West (“BOW”) against Ballantine and the primary Guarantor for over $18,000,000, alleging non-payment of debt when due. After careful strategic analysis, FBB&C counterclaimed on behalf of its clients alleging fraud and interference with Ballantine’s business by BOW. This case is scheduled for trial in November 2010 in Fresno, California.

FBB&C turned a defensive case by a lender against a co-obligor into an offensive action against the bank. Here, the bank initiated the action by suing the guarantor on an alleged “unlimited guaranty” that secured a business line of credit issued to the company (in its heyday the top after-market auto parts wholesaler in the country). When the company defaulted, nearly $10,000,000 was still owed on the line. In response, FBB&C filed a cross-complaint against the bank, alleging various tort theories of recovery by the guarantor. The bank’s exposure on the cross-complaint gave FBB&C leverage to settle the case, capping the guaranty at $3,500,000 and exonerating nearly 80% of that amount.
Successful Defense of $5,000,000 employment and partnership dispute (2008) Plaintiff Doctor was an employee and shareholder in a closely held medical company. Doctor alleged wrongful termination in violation of public policy, failure to follow corporate formalities, and failure to properly pay severance. The lawsuit sought $5,000,000 in compensatory damages, “millions of dollars” in punitive damages, and recovery of attorneys fees. FBB&C diligently pursued discovery, advised the company how to comply with corporate formalities, promptly retained an economist expert, and filed a motion for summary judgment. Less than one year after the suit was filed, and on the eve of the summary judgment hearing, FBB&C reached a confidential settlement for nuisance value (approximately 1% of the amount sought in the lawsuit).