More Topics:
Court Grants $23.4 Million Judgment Against JP Morgan's Strategic Property Fund
Posted February 6, 2012
We Recommend...
NEW YORK - Earlier today, the U.S. District Court in Manhattan entered judgment against JP Morgan's Strategic Property Fund and in favor of a Dutch pension fund, Pensioenfond Metaal en Techniek ("PMT"), in the amount of $23,412,790.82. The judgment was based on an opinion rendered on February 3rd by Judge Richard J. Sullivan. John G. McCarthy and Steven E. Brust of Smith, Gambrell & Russell, LLP represented PMT during the bench trial.
The case involved a dispute over valuation methodology employed by the board of a west coast REIT called Donahue Schriber Realty Group ("DSRG"). A put agreement between the parties required the JP Morgan fund to buy out PMT based on the net asset value ("NAV") set by DSRG's board as of September 30, 2008.
As Judge Sullivan noted in his decision, JP Morgan argued that the value set was too high because the Board did not make certain adjustments to reflect the impact of the 2008 economic crisis on DSRG's value. Further, JP Morgan argued that the Board knew the value was overstated, but decided to approve it anyway rather than conduct a complete appraisal of DSRG's 86 shopping centers.
The federal court credited the testimony of PMT's witnesses, Stephen Latimer of Clarion Partners and Dr. Robert Edelstein of Cal-Berkeley, that the methodology was reasonable and reflective of DSRG's actual value in light of how events like Lehman Brothers' bankruptcy would impact real estate like DSRG's centers.
Smith, Gambrell & Russell is a full service, international law firm that advises regional, national and global businesses on a wide range of legal matters. The firm's 175-plus attorneys provide legal counsel in practice areas including corporate transactions, litigation, intellectual property, aviation, banking, construction, employment and environmental law. Founded in 1893, SGR has offices in Atlanta, Jacksonville, New York, Stamford, Washington, DC and Frankfurt, Germany. Please visit www.sgrlaw.com for more information.
To find out more about the company in this article and to see if you
have business connections, click below:
-
Smith, Gambrell & Russell, LLP
blog comments powered by