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Citigroup Wins $364.2 Million in Parmalat Fraud Trial
Award is the fifth-largest so far this year in the U.S., by one account
The American Lawyer
October 21, 2008
A New Jersey jury awarded Citigroup $364.2 million in damages on Monday after finding that Italian dairy giant Parmalat defrauded the financial services firm in a case stemming from a 2003 accounting scandal.
The 6-1 verdict ends months of litigation, which The Am Law Daily experienced firsthand during opening arguments in May before the case went on a six-week hiatus in late summer.
Represented by Quinn Emanuel Urquhart Oliver & Hedges partners Kenneth Chiate, Steven Madison, Marc Greenwald and Peter Calamari, Parmalat accused Citigroup of being complicit in the fraud that pushed the company into bankruptcy in December 2003. The ensuing scandal became known as "Europe's Enron."
Seeking $2.2 billion in damages, Parmalat filed suit against Citigroup in New Jersey's Bergen County Superior Court because that was where the company's former U.S. subsidiary -- now called Farmland Diaries -- was based. The Am Law Daily reported in May that the case created some strange bedfellows between plaintiffs firms and Quinn Emanuel lawyers.
Citigroup turned to Paul, Weiss, Rifkind, Wharton & Garrison litigators Theodore "Ted" Wells Jr., John "Jack" Baughman and Daniel Levi, who brought counterclaims against Parmalat, accusing the company of deceiving their client.
After three days of deliberations, jurors awarded Citigroup the highest amount they could grant for monetary damages.
The award was the fifth-largest so far this year in the U.S., according to data compiled by Bloomberg. Citigroup must present the agreement to an Italian bankruptcy court in Parma, which could grant the company shares in the diary giant.
Parmalat, which emerged from bankruptcy in 2005, currently has related civil actions pending against accounting firm Grant Thornton and Bank of America in U.S. district court in Manhattan.
This article first appeared on The Am Law Daily blog on AmericanLawyer.com.
