NY Court Decides in Favor of Private Equity Money Manager Cabot
In an unusual case for the usually clubby world of private equity, on November 13, 2007, a New York jury rendered a judgment of approximately $10 million against CS SCF Management Ltd., a wholly owned subsidiary of Credit Suisse, in favor of C2C Consulting, Ltd., the Cayman-based affiliate of London-based private equity money manager Cabot Square Capital.
In 1996, Cabot entered into a contract with Credit Suisse to manage a private equity fund sponsored by Credit Suisse. Cabot subsequently alleged that Credit Suisse breached the agreement when it failed to pay a break-up fee upon termination of the fund in 2003. Cabot also sought the release of certain funds it had deposited in an escrow account to secure a potential clawback liability.
Following a three and one-half week trial before the Hon. Ira Gammerman of the New York State Supreme Court, Commercial Division, the jury found for Cabot on all counts after one day of deliberations.
Cabot was represented by Kenneth M. Van Deventer of Riker Danzig Scherer Hyland & Perretti LLP. Credit Suisse was represented by Jay Fastow and John Mastando of Weil Gotshal and Manges.