commercial law news
August 11, 2015 – Partner Randy Erlewine has been named a Northern California Super Lawyer for 2015, a recognition bestowed annually on the top 5% of practicing lawyers in the region. Randy has received recognition for his extraordinary work in each of the years 2005 through 2010, as well as in each of the years 2012 through 2014. Randy’s practice includes commercial and employment and labor law matters.
June 18, 2015 – A Florida state court has granted the firm permission to file an amended complaint in a legal action brought by the firm’s clients against the proprietors of the popular Endless Jewelry line of products. The amended complaint filed today adds defendants, including the parent entity as well as that entity’s founder and CEO, and asserts additional claims for fraud, breach of fiduciary duty and conversion of ownership interests, among others. At its core, the current complaint alleges that plaintiffs conceived of, developed and launched the Endless Jewelry business in North and South America based on representations and agreements that they would receive a substantial ownership interest plus other compensation, but were later shut out of involvement in and denied a portion of the ongoing business. Defendants’ response to the amended complaint is expected next month.
Firm to enter Florida case over Endless Jewelry dispute
March 31, 2015 -- Partner Randy Erlewine appeared as counsel of record for plaintiffs in legal action against the proprietors of the popular Endless Jewelry line of products. The case involves the circumstances of the 2014 start-up of a new line of jewelry that reportedly has already become a $25 million a year business and has attracted the interest of investors as well as a license for a specialty line of Jennifer Lopez branded product. Plaintiffs say they conceived of the concept for the new jewelry line, developed and implemented the business plan to launch it and organized personnel and distribution, after which they were shut out of any further involvement and denied a portion of the ongoing business. In addition to the firm, plaintiffs' legal team includes renowned South Florida litigator Bruce Rogow as well as the prominent Ft. Lauderdale plaintiff law firm of Conrad & Scherer LLP. An amended complaint amplifying plaintiffs' claims is expected shortly.
Firm represents key personnel and shareholders in acquisition by Fortune 500 Company
July 9, 2014 -- Partner Randy Erlewine represented the high-level executives and minority shareholders of a San Francisco-based consulting company in connection with the company’s acquisition by a global commercial real estate services and investment firm. The firm, among other things, protected its clients’ interests by negotiating the terms of their employment agreements and (for personnel located outside California) non-compete agreements. The firm’s work contributed to the successful and timely completion of the transaction.
Firm client wins commercial lease dispute with landlord
February 11, 2014 -- In a Final Arbitration Award issued today by the Hon. V. Gene McDonald (Ret.), partner Nicholas Carlin obtained total victory for the firm's client, a local independent record label. The client's lease gave it the right to sublet the premises subject only to the landlord's consent, not to be unreasonably withheld, and to split with the landlord any excess rent that the sublessee might pay over and above the original rent. The client wanted to move out and sought to sublet the premises. Rents had gone up dramatically and the landlord, not wanting to share the excess rent, engaged in bad faith tactics to delay and ultimately deny consent. After the client moved out, the landlord immediately turned around and rented the space directly to the proposed subtenant on terms identical to the proposed sublease. After a three-day trial, Judge McDonald found that the landlord had unreasonably withheld consent and had acted in bad faith. He awarded the firm's client damages on every element claimed as well as the right to share the future excess rent, a total value of approximately $250,000. Judge McDonald also ruled almost entirely in the client's favor on the landlord's $300,000 cross-complaint, finding in the landlord's favor on one item of damage for less than $900. The case settled shortly after the firm filed its motion for attorneys' fees and costs.
Firm vindicates client's rights in Court of Appeal
August 1, 2013 -- PE&G persuaded the California Court of Appeal to reverse a trial court decision allowing a trade organization to use the California Public Records Act to obtain a client’s private records. The client, San Francisco Bar Pilots (“SFBP”), is a private association of licensed pilots who maneuver ships through the San Francisco Bay and related waterways. The state imposes certain duties on SFBP, and in particular on the pilot who serves as “Port Agent.” Pacific Merchant Shipping Association, a trade organization representing the shippers required to pay SFBP fees for pilotage, attempted to use the Public Records Act to obtain extensive records created and used by SFBP – but not by any public officer or agency. In a published opinion, the Court of Appeal rejected PMSA’s assertion that SFBP’s records are public and agreed with the firm’s arguments that the evidence presented to the trial court unequivocally demonstrated that the records PMSA sought are private and not subject to the Public Records Act.
Federal Court approves record label settlement with former hedge fund manager
November 7, 2012 -- PE&G attorneys David Given and Nick Carlin helped to successfully conclude a favorable settlement on behalf of its long-standing client OM Records in litigation pitting it against former hedge fund manager Lawrence R. ("Larry") Goldfarb and his solely owned entity, LRG Capital Group, over various improprieties committed by Goldfarb in connection with supposed "investments" made by him through LRG Capital in OM Records. United States District Judge William H. Alsup, who is presiding over parallel civil and criminal proceedings against Goldfarb initiated by the Securities and Exchange Commission and the U.S. Department of Justice respectively, approved the settlement made by OM Records with the receiver appointed by the court to oversee Goldfarb's business and financial affairs. As previously reported here, that appointment followed Goldfarb's default in his deferred prosecution agreement with the federal government; Goldfarb now faces the possibility of a felony conviction on pending wire fraud charges and a sentence of jail time if convicted. In the OM Records litigation, Goldfarb faced terminating sanctions for violating court orders to appear for his deposition and to produce documents (and to pay a monetary penalty for his previous failures). The settlement with Goldfarb's receiver allows OM Records to conclude all litigation on the subject as well as to separate itself completely from any business relationship with Goldfarb (who sat on its board) and LRG Capital (with whom it had entered into various financing agreements), all for a small fraction of the over $2 million Goldfarb and LRG Capital tried to extract from it.
Nick Carlin and David Given named as finalists for CAOC Consumer Attorneys of the Year
October 23, 2012 -- The Consumer Attorneys of California (CAOC) has named Nick Carlin and David Given finalists for the "Consumer Attorney of the Year" award for their work in obtaining a $410 million settlement from Bank of America on behalf of customers who were overcharged with overdraft fees, one of the largest settlements in a consumer class action ever. Bank of America and other banks had engaged for years in a scheme to systematically process debit card transactions not in the order they occurred but from highest to lowest, for the sole purpose of maximizing overdraft fees. Carlin and Given originated the case, which was eventually consolidated with other lawsuits against the nations' leading banks in multi-district litigation. The federal judge who approved the settlement wrote: "This is a marvelous result for the members of the class ... but for the high level of dedication, ability and massive and incredible hard work by [their] attorneys ... I do not believe the Class would have ever seen a penny." For an article from the Business Wire about the award nomination, click here.
Firm stands by local record company OM Records in legal battle with former hedge fund manager
May 8, 2012 -- The Daily Journal featured an article on PE&G's representation of long-time client OM Records in litigation with former hedge fund manager Lawrence R. "Larry" Goldfarb and his wholly-owned business entity, LRG Capital Group. Goldfarb, arraigned in federal court last month on one count of wire fraud, has been accused by the federal government of "secretly diverting" approximately $12 million from a hedge fund he managed -- part of which allegedly ended up as an "investment" by LRG Capital in OM Records. In a judgment entered against him and one of his related business entities, Goldfarb was ordered to pay the amount of the allegedly "diverted" money together with interest and penalties into a court-established fund. (In a related administrative proceeding, Goldfarb was barred from the investment advisory business.) To date, he has failed to do that, and now faces the possibility of contempt of court, following a hearing at which United States District Judge William H. Alsup repeatedly referred to Goldfarb as a "fraudster." OM Records has been engaged in litigation with Goldfarb and LRG Capital related to this history and those parties' efforts to extract consideration from OM Records, including membership on its board of directors. In that action, San Francisco Superior Court Judge Loretta M. Giorgi entered an order last year finding that OM Records had "raised sufficient concerns on the current record as to how... Goldfarb acquired his directorship, i.e., by fraud." Goldfarb was also the subject of a recent sanction for failing to appear for his deposition in the case. The court has set a November trial date in the matter.
UPDATE -- June 26, 2012 -- In a blistering order, Judge Alsup found Goldfarb in civil contempt and imposed several remedial sanctions, including the appointment of a receiver to take control of his business and financial affairs. The order appointing the receiver stays all further proceedings in the Om Records case. The client is currently engaged in negotiations with the receiver in the hope of resolving this litigation
Firm obtains million-dollar judgment in trade secrets case
September 9, 2011 -- Judge Ellen Chaitin of the San Francisco Superior Court entered judgment in the amount of $1,106,654.86 against defendant Matthew Jones in favor of PE&G's client, Potrero Media Corporation (PMC), a leading performance-based marketing agency specializing in search marketing, lead generation and online publishing services. PMC contended that Jones, a former employee, had misappropriated trade secrets to start a competing business. PMC previously settled with co-defendants Lead Consortium and Ryan Ousdahl. After repeated discovery violations by Jones, the court found him in contempt and issued terminating sanctions, finding him liable on all counts. A court trial was subsequently held on damages and the court awarded the above amount. The court also made its previously issued Preliminary Injunction permanent.
Firm obtains TRO and preliminary injunction for Internet marketing client
October 19, 2010 -- Extending its winning streak in trade secrets cases, PE&G successfully obtained a Temporary Restraining Order for client Potrero Media Corporation ("PMC") in San Francisco Superior Court. The order enjoins a former PMC employee and his alleged conspirators from using PMC's trade secrets and from doing business with PMC's clients. PMC, one of the nation's top online lead generation companies, alleges in the lawsuit that a former PMC employee conspired with a PMC client to steal PMC's customers and to use PMC's trade secrets to unfairly compete with PMC. The TRO was obtained only days after PMC realized what its former employee was doing and referred the matter to the firm. On August 24, 2010, Superior Court Judge Charlotte Woolard made a finding that PMC was likely to succeed on the merits and issued a Preliminary Injunction extending the injunction throughout the duration of the case. The litigation is now in the discovery phase.
Firm helps settle multi-jurisdictional dispute over world-class collection of tribal art
April 14, 2010 -- PE&G recently participated in protracted, multi-party negotiations concerning legal proceedings in three different jurisdictions, which have led to the settlement of a dispute over the world's largest (and possibly, most important) private collection of New Guinea tribal art. A report on the settlement, which preserves the vast majority of the collection for exhibition at San Francisco's deYoung Museum, appeared on the front page of the San Francisco Chronicle. For a copy of that article, click here.