Our first runners-up this week are Robert Sacks and Diane McGimsey of Sullivan & Cromwell who fended off claims packing more than $100 million in potential damages for New York real estate investor Richard D. Cohen. After a December bench trial, U.S. District Judge Jesse Furman last week sided with Cohen finding that he wasn’t personally liable for a loan used to buy a San Francisco residential apartment complex. The plaintiff, an affiliate of Carmel Partners, a major investor in multifamily real estate that acquired the underlying load, claimed that liens recorded against the property triggered carve outs in the loan agreement for certain “bad boy” acts. But Furman found that the plaintiff’s reading of the loan agreement would produce a result that was “absurd” and “commercially unreasonable.”
A Latham & Watkins team led by partners Michele Johnson and Colleen Smith takes home a runner-up spot for knocking out a shareholder class action against GoodRx Holdings Inc. Plaintiffs brought claims the drug discounting company failed to disclose potential competition from Amazon at the time of its 2020 initial public offering. U.S. District Judge David Carter in Santa Ana, California, dismissed the case without prejudice last week. In a point that’s likely to be useful for defendants in future cases brought under Section 11 of the Securities Act, Carter concluded that Section 11 damages should be calculated based on the price the plaintiff paid for the stock rather than its alleged value. “With an undisputed IPO price of $33 and no drop below that in the entire period until the filing of this suit, there is no evidence of any loss to plaintiffs,” Carter wrote. The Latham team included associates Jordan Cook, Morgan Whitworth, Sheridan Caldwell and Ashley Gebicke.
