Miami veteran bankruptcy attorney’s first jury trials lead to $ 3 million reward
Because bankruptcy court isn’t known to juries, Miami attorney Jeffrey Bast of Bast Amron has spent 25 years without dealing with a jury trial. That is, until two people show up at a time in a business dispute, which resulted in a Texas appeals court claiming a $ 3 million award – and its client recovering the total amount after four years of litigation.
It’s a case that could offer a lesson in how to counsel determined clients about the risks of the lawsuit, as attorney’s compensation of $ 1.6 million and over $ 350,000 in interest, fees and penalties rivaled each other. with the underlying judgment of $ 2 million.
“Sometimes customers fight on principle because they think they’re right, but whether or not you think you’re right isn’t always the right driver for the math,” Bast said. “The economy should always take precedence over emotions, and this is a case where I think the defendants thought they were right and did not accept the risk that they might be wrong, or that someone was wrong. other thinks they were wrong, and that is not how business decisions should be made.
Bast and his colleagues Lissette M. Carreras, Peter J. Klock II and Zakarij N. Laux teamed up with Michael McCabe and Sarah Lopano of Munck Wilson Mandala in Dallas to represent Valtech Solutions Inc. and Valtech Services Inc., who provide services of digital marketing and technology to companies such as L’Oréal, Levi Strauss & Co., Heineken and Toyota.
This dispute began when Valtech bought a company that had its own recruiting agency, which it then sold to a national recruiting company headquartered in California, Cornerstone Staffing Solutions Inc.
The purchase was made in two installments – a $ 1.9 million closing payment and a payment adjustment based on a percentage of revenue – according to the lawsuit, which claimed Cornerstone refused to make the second. payment.
And while the vast majority of most commercial contracts include exemptions from jury trials, this one did not. Bast noted that he and his team were not involved in the preparation of the deals.
After about two years of trying to negotiate, Bast and his team hopped on Airbnb to rent a large house together in Dallas for two forked lawsuits with separate juries. The first lasted two weeks and the second lasted a week.
The trial job is not for the faint of heart, Bast realized, and said he even found himself losing weight after forgetting to eat during the day and not getting enough sleep.
“I’ve never worked harder in my life, in my practice, at anything, during those two weeks,” Bast said. “We moved there and lived, worked and breathed the trial for two weeks straight. “
Cornerstone has denied any wrongdoing and filed 19 counterclaims, alleging, among other things, that Valtech failed to provide accurate financial information during its due diligence investigation.
Dallas attorneys Todd Harlow of Frost Brown Todd and Helen Hutton, Dorlin Lafer-Sousa and Nina Valdez of Cowles & Thompson represent Cornerstone. They did not immediately respond to a request for comment.
Facing his very first trial, the biggest challenge for Bast was figuring out how to turn complex terms and evidence into strong arguments for jurors. The plaintiff team chose a cartoon company, which created an animation of a hand with a marker pen sketching illustrations to explain business and legal concepts.
“We knew that if I just sit there and try to explain what’s going on and what a spinoff is and how it works, the EBITDA [earnings before interest, taxes, depreciation and amortization] and things like that, then we’re going to have a hard time, ”Bast said. “But the jury got it.”
The two juries finally sided with Valtech. And after the Dallas Fifth District Court of Appeals upheld the verdict, Bast said the defendant paid all damages, interest, costs and fees.
According to Bast, it helped that the CEO of the defendant made a contradictory statement. The CEO initially said that if he had known the full extent of the recruiting company’s financial situation, he would never have bought it, according to Bast, while in cross-examination it turned out that he had received the relevant information in a tab of a spreadsheet, but I had not noticed it.
Most lawsuits like this are resolved quickly, according to Bast. He said the resulting attorney fees were due to the accused’s refusal to compromise, as Valtech offered to settle on several occasions, including mid-trial.
“Sometimes customers are motivated by emotions, and it’s our job to help the customer remove emotions from decision making and make business and economic decisions rather than emotional decisions,” Bast said. “We had a client who was committed to doing the right thing and doing justice, so they stood by us all the way, even though they would have preferred not to be in litigation. “
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