Facts

The plaintiffs (CEO and his small company) worked to structure a deal with a foreign energy company to loan him and two partners in excess of $1 billion, to purchase a U.S. energy company ("target"), with the intent that he would then transfer the target's foreign assets to the foreign company making the loan, and keep the target's U.S. assets, worth in excess of $500 million, as profit.

The plaintiffs alleged the foreign company had agreed to do this because U.S. regulations would make it unlikely that a foreign energy company could directly purchase all of the target company directly because of the regulation of its "strategic" U.S. energy assets. The plaintiffs then hired a international law firm and attempted to engage an investment banking firm to assist with the proposed transaction. The plaintiffs alleged that they disclosed highly confidential and proprietary information about the transaction to the investment bankers, who then sent one of their bankers to directly meet with the president of the foreign energy company in an attempt to obtain direct engagement to make the purchase, and to cut plaintiffs out of their envisioned deal.

The plaintiffs alleged that this attempted circumvention destroyed plaintiffs' credibility and economic relationship with the foreign energy company, causing them to refuse to go forward with the proposed transaction. The investment bank subsequently assisted another client in a successful acquisition of the target company.

PLAINTIFFS' CONTENTIONS:
The plaintiffs alleged that the investment bank had breached duties to keep their information confidential, had converted and misused their confidential information in an attempt to circumvent them and intentionally interfered with their economic relationship with the foreign energy company. The plaintiffs further alleged that the investment bank later used their proprietary information in their effort to assist their other client in purchasing the target company.

DEFENDANT'S CONTENTIONS:
The defendants alleged that the meeting their banker had with the foreign company was a legitimate attempt to accomplish due diligence on the plaintiffs and their proposed transaction, and that they did not intend to, or actually interfere with plaintiffs' proposed transaction.

The defendants further alleged that plaintiffs were ill equipped to complete a transaction of the size contemplated and that the deal had no chance of success, whether interfered with or not.

Settlement Discussions

The case was mediated (unsuccessfully) three times before trial began. Trial lasted 16 trial days. Settlement was agreed to shortly before closing arguments. The initial demand was $230 million. The initial offer was $33,333.

Damages

The plaintiffs alleged that they would have successfully completed their transaction but for defendants' interference, and would have obtained ownership of the U.S. assets of the target company, worth in excess of $500 million. The plaintiffs asserted a claim for punitive damages based on the intentional torts alleged. The defendants alleged that plaintiffs had no chance of completing their transaction, and that it was highly unlikely that any foreign company would agree to "give away" in excess of $500 million in assets as plaintiffs envisioned.

Result

The case settled on the 17th day of trial for $18.5 million.