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Securities
Fraud
Fraud

Kennilworth Partners v. Crisman

Published: Nov. 15, 2001 | Result Date: Oct. 10, 2001 | Filing Date: Jan. 1, 1900 |

Case number: 313497 Verdict –  $0

Judge

Paul H. Alvarado

Court

San Francisco Superior


Attorneys

Plaintiff

Joseph M. Abell

Daniel S. Mason
(Furth, Salem, Mason & Li LLP)


Defendant

James McShane

Gregory A. Long


Experts

Plaintiff

Ralph A. Cotton
(technical)

Defendant

Troy A. Dahlberg
(technical)

Facts

The plaintiff, a hedge fund, invested $25 million in Applied Magnetics Corporation, which subsequently went
into bankruptcy. The plaintiff sued three former officers and directors, alleging that they had made false
statements concerning the companyÆs financial affairs with the intent of inducing the investment. In addition to
contending that three former officers and directors had made false statements with the intent of inducing the
investment, the plaintiffs also claimed violations of state securities law and fraud.
The defendants denied that any false statement was made regarding a material fact and
that no material fact had been omitted.

Settlement Discussions

The plaintiff made a demand of $9.5 million. The defendants offered $750,000.

Damages

$25 million representing the loss of the investment.

Deliberation

one day

Poll

11-1 (for defendants on all issues)

Length

six days


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