Risk is part of doing business, but volatile markets, increasing globalization, the spread of technology, and evolving business models have reshaped its nature and profile. Risk liability can be complex in an environment with high volumes of M&A activity, and international businesses are more vulnerable to cross-border litigation as risk areas expand. Areas such as class action law are spreading to other jurisdictions, and patent litigation is growing in line with the value of intellectual property to company assets. Business must remain vigilant to shifts in the litigation market, and in regulators' attitudes. While the range of litigation risks is expanding, monitoring potential risks as part of a robust compliance culture is better than a court date in the future.
We successfully defended American Apparel and its chairman Colleen Brown in a defamation lawsuit filed by former CEO DovCharney. The suit alleged that Ms. Brown, on behalf of the company, sent a letter to all employees containing false claims, including that Mr. Charney was fired for cause after an independent investigation revealed financial and sexual wrongdoing. Mr. Charney also alleged that the investigation was not independent because it was paid for by the board and produced by a company hired by American Apparel's outside general counsel. We moved to strike the complaint based on California's anti-SLAPP statute, arguing that Mr. Charney was suing over acts of free speech and could not demonstrate a probability of prevailing. The court agreed.
We defeated class certification and obtained a favorable statutory construction ruling on behalf of retailers in a case brought under California's Song Beverly Credit Card Act. The plaintiff alleged he was asked at a Kiehl's retail store to provide his personal identification information in order to purchase items with a credit card, which is prohibited by the Act. Kiehl's is part of the L'OréalGroup. We obtained several key admissions from the plaintiff, which we used to oppose class certification. We also relied on evidence of Kiehl's policies and practices to argue that the Act does not prohibit Kiehl's practices. In denying the plaintiff's motion for class certification, the court rejected the plaintiff's broad interpretation of the Act and accepted our statutory interpretation arguments. While several federal courts had previously rejected this broad interpretation, this was the first time that a state court adopted the narrower interpretation advanced by retailers. The order was later affirmed on appeal, ensuring a complete victory for our client.
Our lawyers are prosecuting several complex adversary proceeding claims on behalf of Lehman Brothers concerning interest rate swap transactions. These matters involve disputes over early termination procedures under the International Swaps and Derivatives Association's agreements, and the valuation of the counterparties' gains and losses as a result of early termination. We are one of the few law firms to advise on such matters in this context, representing the debtor.
We represented a leading global insurer in a complex, five-party arbitration brought by two sets of claimants (European and U.S. commodities traders and two foreign banks). The dispute concerned the legitimacy of significant commodities trades in a Latin American country, the issuance of financial instruments from a now-bankrupt Latin American company, and interpretations of an international trade credit insurance policy. The policy was governed by New York and Mexican law, and the seat of the arbitration was New York. Following several years of arbitration, including a parallel litigation in the U.S. District Court for the Southern District of New York, the arbitral tribunal issued a unanimous final award in our client's favor in a take-nothing decision against the claimants. Following its issuance, the claimants decided not to appeal the award in the courts, resulting in a complete victory for our longtime client.