Gerald Horwitz, et al. v. Datametrics Corporation
Published: Jan. 1, 1999 | Result Date: Sep. 28, 1998 | Filing Date: Jan. 1, 1900 |Case number: BC163475 Bench Verdict – $1,693,820
Judge
Court
L.A. Superior Central
Attorneys
Plaintiff
Michael J. Faber
(Law Offices of Michael J. Faber)
Defendant
Ernest Cordero Jr.
(Office of the U.S. Attorney)
Experts
Plaintiff
David Hahn
(technical)
Richard M. Foster
(Foster Advisors PLC)
(technical)
Dann Angeloff
(technical)
Defendant
Daniel Ginns
(technical)
Hugh C. Friedman
(technical)
Facts
Plaintiffs were the president/chief executive officer and three senior vice presidents of defendant Datametrics Corporation. In October 1996, a group of investors sought to take control of the Board of Directors. The outgoing board, fearing that the investors would be able to mount a successful, but expensive proxy fight, voluntarily relinquished their control in exchange for the investors' commitment to provide up to $1.5 million in financing to the corporation. Also, and without telling the investors, the outgoing Board of Directors approved "golden parachute" agreements for the four senior officers, which agreements provided for two years compensation for each of them in the event they were terminated without cause following a change in control of the Board of Diectors. The golden parachute resolution was approved on Oct. 7, 1996, and the change of control occurred on Oct. 8, 1996. The agreements were not written and signed until the following week. On October 11, the new controlling members of the Board of Directors learned of the existence of the golden parachutes and demanded that plaintiffs rescind them. The plaintiffs refused, and on October 23, they were fired, and the board repudiated the golden parachutes. The plaintiffs brought this wrongful termination action against the defendant based on a breach of contract theory of recovery.
Settlement Discussions
The plaintiffs demanded $500,000, increased to $900,000 one week before trial. The defendant made no offer.
Damages
The plaintiffs claimed two year's compensation plus interest, plus attorney fees.
Other Information
The verdict was reached approximately two years after the case was filed.
Length
one week (Bench Trial)
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