Following the so-called “Antitrust Trial of the Century,” in which he defeated the U.S. Department of Justice’s attempt to block AT&T Inc.’s acquisition of Time Warner Inc., Petrocelli won another victory in a widely reported and closely watched case.
As a leader of the defense team after Twentieth-Century Fox Inc. was hit with a $128 million punitive damages award in a breach of contract dispute with actors from the “Bones” television series, Petrocelli achieved the rare success of overturning an arbitrator’s award.
He persuaded a Los Angeles County Superior Court in May to correct the award of the arbitrator, a retired L.A. judge, wiping out the punitive damages and leaving some $50 million in compensatory damages, attorney fees and costs. Wark Entertainment Inc. v. Twentieth Century Fox Film Corp., BC602287 (L.A. Super. filed Nov. 25, 2015).
Petrocelli argued for several hours that the arbitrator exceeded his authority because the contracts at issue expressly waived a right to punitive damages.
The judge rejected the plaintiffs’ and arbitrator’s reasoning that the entire agreements became “fully arbitrable” when Fox submitted the complaint to arbitration.
“It is imperative for arbitrators to scrupulously abide by the parties’ arbitration agreement,” Petrocelli commented recently, “particularly as to limits on arbitral authority.”
Defending AT&T in the antitrust case in June 2018, Petrocelli won the day arguing the acquisition of Time Warner was a vertical merger that did not result in restricting market choice, unlike horizontal mergers of businesses providing the same products or services. U.S. v. AT&T Inc., 1:17-cv-02511 (D. D.C., filed Nov. 20, 2017).
“Both law and economics tell us that vertical mergers are generally pro-competitive and, therefore, less susceptible to an antitrust challenge,” Petrocelli explained.
“The antitrust laws are designed to have broad applicability, and they are perfectly adequate to deal with transactions in today’s marketplace,” he said. “It’s just a matter of understanding the nature and effects of the transactions and assessing whether they will foster rather than stifle competition. There can obviously be disagreements about that.”
Though he had litigated antitrust cases before, AT&T was Petrocelli’s first merger trial.
His strategy? “I took the same tried-and-true approach I’ve used for some 40 years: Follow the evidence and present your case based on the facts and the law.”
— Laurinda Keys
For reprint rights or to order a copy of your photo:
Email
jeremy@reprintpros.com
for prices.
Direct dial: 949-702-5390
Send a letter to the editor:
Email: letters@dailyjournal.com