Commercial Litigation

Lafayette & Kumagai’s attorneys have substantial experience handling complex commercial and bankruptcy litigation.  The firm has represented clients in cases involving the Business and Professions Code Section 17200, unfair business practices actions, contract disputes, ADA access cases, anti-trust and unfair business practices class actions.  The firm has represented Viacom, Inc., MTV Network, Johnson & Johnson, San Francisco Housing Authority, PETCO Animal Supplies, Inc., Denny’s, Inc., Sutter Health and others in these types of matters.

Commercial Litigation – Representative Cases

Trials:

Gary Aronson v. Advanced Cell Technology, Inc. – The firm represented the Defendant in a suit wherein Plaintiff sought over $14 million in connection with an anti-dilution provision in various stock warrants.  Plaintiff dismissed the case two days before the commencement of trial, after reviewing the Court’s tentative decisions regarding Defendant’s Motions in Limine.  2010.

Hassan v. Comerica Bank – Plaintiff sued for race discrimination and breach of contract alleging that Defendant wrongfully foreclosed on his small business loans and delayed disbursements.  Lafayette & Kumagai successfully demonstrated that the foreclosure was lawful and that disbursement delays were the result of plaintiff’s incomplete disbursement requests.  Defense verdict – jury trial.

FDIC v. Berr – United States District Court, Eastern District.  Lafayette & Kumagai represented the FDIC in a bankruptcy adversary proceeding seeking to avoid the borrower’s discharge of debt to the FDIC. This action involved a “straw borrower” who was alleged to have conspired with insiders in a scheme to defraud the Indian Springs State Bank in Kansas.  The debtor sought to discharge his debt in bankruptcy and offered as his defense the fact that the bank vice president knew he was acting as a “straw borrower.”  Lafayette & Kumagai relied upon D’Oench Duhme & Company v. FDIC, 315 U.S. 447 (1942) in a successful defense at trial.  In re Berr (Berr v. FDIC), 172 BR 299 (9th Cir. BAP 1994)

In Re Villa Serena Partners – U.S. Bankruptcy Court, Northern District of California.  This matter involved a complex Chapter 11 case wherein Lafayette & Kumagai’s client, the Resolution Trust Corporation, sought to obtain relief from an automatic stay and foreclosed upon a one hundred and eleven (111) unit congregate care facility located in Santa Clara County.  This foreclosure resulted in a trial lasting only two days after Lafayette & Kumagai showed that the plan of reorganization was not feasible.

Honeywell v. San Francisco Housing Authority – Plaintiff filed suit for $10.5 million, claiming that its contract to make energy-saving improvements to 13 senior housing complexes with the San Francisco Housing Authority was valid.  The Housing Authority contended that Plaintiff invalidated the contract by failing to secure the necessary financing as required by a prior agreement and that work-completed certificates had been obtained during a round of office layoffs amid the HUD takeover of the agency.  The jury deliberated for two hours and returned a defense verdict.  U.S. ex rel. Honeywell, Inc. v. San Francisco Housing Authority, 83 Fed.Appx. 181 (9th Cir. 2003); Honeywell v. San Francisco Housing Authority, 164 F.Supp.2d 1130 (2001)

Unicom Computers v. International Business Machines – Lafayette & Kumagai represented IBM in a preference action filed by debtor Unicom Computers, represented by the bankruptcy firm of Goldberg, Stinnett & MacDonald. The claim involved a $1 million dispute. IBM prevailed at trial after successfully arguing that IBM met the “ordinary course of business” exception.  In re Unicom Corp., 21 F.3d 1116 (9th Cir. 1994)

Oliver v. Oakland Housing Authority – This two-month trial involved the complaints of 56 residents for alleged unlawful evictions, retaliation and habitability violations including violence and crime.  The jury returned defense verdicts on all claims after five hours of deliberation.  Defense verdict – jury trial.

Other Cases:

In Re Richmond Unified School District – In this Chapter 9 bankruptcy proceeding, Lafayette & Kumagai assisted IBM in negotiations with the bankrupt Richmond Unified School District over payment for computers. The matter was resolved when the District dismissed its bankruptcy petition.

In Re Danville Research Associates – Lafayette & Kumagai successfully defended Pacific Bell in an action involving the debtor’s right to assume multi-million dollar executory contracts it had entered into with Pacific Bell.  Pacific Bell prevailed and the bankruptcy Court ordered the contracts rejected.

Halloum v. Denny’s, Inc. – Plaintiff alleged that an oral agreement to grant him a Denny’s franchise was breached.  Plaintiff alleged causes of action for breach of oral contract, promissory estoppel, negligent misrepresentation, discrimination and unfair business practices.  The court granted summary judgment in favor of Lafayette & Kumagai’s client, Denny’s, on the grounds that the alleged oral agreement was barred by the statute of frauds; Plaintiff failed to produce evidence of any reasonable reliance on the alleged misrepresentations; and that Plaintiff presented no evidence to refute the legitimate business reasons Denny’s presented for denying Plaintiff a franchise.

The City of Oakland v. Woods Gordon – Lafayette & Kumagai represented the City of Oakland in an action against Ernst & Ernst for breach of contract in connection with the sale of its management information software system.  Plaintiff successfully recovered a significant sum of money on the theory that Ernst & Ernst failed to provide its software in a timely manner and, thereafter, failed to supply software consistent with its representations.

San Francisco Housing Authority v. ARS – Lafayette & Kumagai represented the San Francisco Housing Authority in an action against ARS for its failure to provide a management information system in a timely manner and, thereafter, failing to deliver a system that met the requirements specified by the San Francisco Housing Authority.

City and County of San Francisco v. Chen & Hensold – The firm joint-ventured with Thelen, Marrin, Johnson & Bridges in representing the City of San Francisco.  The City sued its design team, Chen & Hensold, for negligence relating to the rehabilitation of the City’s cable car system.

ANG Newspapers, Inc. v. City of Oakland – The firm successfully represented the City of Oakland in opposing a petition for access to public records and a subsequent writ of mandate filed by ANG Newspapers, Inc. in an attempt by The Oakland Tribune (a subsidiary of ANG Newspapers) to obtain records regarding the investigation of highly publicized allegations of sexual harassment made against a senior official in the Mayor’s office.  The case was initially filed in Alameda County Superior Court and was ultimately decided on appeal by the California Supreme Court with a positive result for the firm’s client.

Lifescan, Inc. v. Premier Diabetic Services, Inc. – Lafayette & Kumagai represented Lifescan, Inc. in an action relating to a one-million dollar claim for breach of contract, conversion and fraud due to a Medicare scam perpetrated by Premier Diabetic Services, Inc.  The firm won an arbitration award of nearly $930,000 plus interest for its client, Lifescan, Inc.

In Re At Home Corporation, et al. (Morrow v. Leo Burnett, Inc.) – The firm represented the MTVi Group and MTV Networks in a bankruptcy adversary proceeding in which Excite@Home sought to recover over $24 million from the MTV family, alleging breach of a contract whereby the MTV family agreed to provide music content to the internet portal of the Excite family at a new, jointly created, co-branded site.  After the firm aggressively pursued discovery against Excite’s former officers, the case was settled for a small fraction of the initial demand.

Echostar Satellite LLC v. Viacom Inc. – This case involved anti-trust litigation over Dish Network’s right to continue carrying the Viacom family of channels, including CBS, MTV, BET, Nickelodeon and Spike.  The firm was co-counsel with Shearman & Sterling LLP and Simpson Thacher LLP, in representing Defendant Viacom.  The matter was resolved after the District Court denied Echostar’s request for preliminary injunction to prevent Viacom from terminating its feed of channels.

Guyette, et al. v. Viacom, Inc., et al. – The firm was retained to try this case on behalf of Defendant Viacom after the Superior Court granted Plaintiff’s motion for class certification and after a failed mediation in which Plaintiff demanded in excess of $78 million.  In this consumer class action Plaintiff sought entitlement to tax rebates accorded Viacom in connection with its cable television franchise.  The case settled three months later for $13 million.

Drummer, et al. v. San Francisco Housing Authority – In three highly publicized and vigorously contested matters, the firm assisted the San Francisco Housing Authority in resolving disputes concerning the agency’s inability to pay over $19 million in judgments.  The firm delayed and ultimately resolved the dispute by raising constitutional and statutory arguments regarding the state court’s ability to enforce monetary judgments against public entities primarily funded by the federal government.

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