Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Motorola, Inc., and Nokia Corporation hoped to make new connections in Asia when they made a loan to a Turkish telecommunications company. But according to a suit Motorola and Nokia filed in Manhattan federal court, the family that controls the Turkish company pocketed the money instead. Judge Jed Rakoff agreed, ruling that the Uzan family must pay $4.26 billion to Motorola. By the time the case went to trial, Nokia did not have surviving claims allowing a cash award. But Judge Rakoff awarded Nokia the stock that the Uzans had used for collateral on the loan, as well as a $1.71 billion fine should the Uzans fail to turn over that stock. Beginning in April 1998 Motorola and Nokia loaned $2.7 billion to Telsim Mobil Telekomm�nikasyon Hizmetleri A.S. The money was earmarked for purchasing equipment and acquiring a Turkish cellular license. The collateral for the loans: Telsim stock, held in another company also controlled by the Uzan family. Motorola and Nokia claim that the Uzans then intentionally devalued the collateral stock. The family also allegedly diverted the borrowed funds for their personal use, including the purchase of private planes and yachts. Telsim denied these allegations, claiming that the plaintiffs’ loss was due to a worldwide slump in the telecommunications market as well as the devaluation of the Turkish lira. The defendants also argued that the agreements between Telsim, Motorola, and Nokia were governed by Swiss law, because the parties agreed to arbitrate in that jurisdiction. Motorola brought suit in federal court under the Racketeer Influenced and Corrupt Organizations act, and also alleged violations of Illinois law. The RICO claims were dismissed, but Judge Rakoff exercised supplemental jurisdiction to award Motorola $2.13 billion in compensatory damages and $2.13 billion in punitive damages. The judge also ordered the arrest of five members of the Uzan family and associate Antonio Betancourt, should they ever enter his jurisdiction. Telsim is appealing the judgment. At press time the U.S. Court of Appeals for the Second Circuit had temporarily stayed enforcement of the judgment. For plaintiff Motorola, Inc. (Schaumburg, Illinois) In-house: Executive vice president and general counsel A. Peter Lawson and senior counsel Jeff Johnson and Bob Patton. Steptoe & Johnson (Washington, D.C.): Charles Cole, Steven Davidson, Christopher Gibson, Adam Greaves, Douglas Green, Howard Stahl, Timothy Walsh, and associates Michael Baratz, Bruce Bishop, Gordon Clay, John Clopper, Frank Griffin IV, Kevin Muhlendorf, John O’Connor, and Thomas Sprange. (Gibson, Greaves, and Sprange are in the firm’s London office.) For plaintiff Nokia Corporation (Espoo, Finland) Holland & Knight (Tampa): Neal Beaton, Jason Brown, David Howe, and associates Joseph Augustine, Allison Kort, Adam Richards, and Parisa Tafti. (All are in the firm’s New York office.) For defendants Kemal Uzan, Cem Uzan, Murat Uzan, Melahat Uzan, Aysegul Akay, and Antonio Betancourt (Istanbul) Gibson, Dunn & Crutcher (Los Angeles): Robert Serio and associates Prasanth Akkapeddi and Peter Skinner. (All are in the firm’s New York office.) Gibson, Dunn was brought in by the Z�rich-based law firm Homburger, which is counsel for the Uzans in arbitrations. Baker Botts (Houston): Michael Barta, Kenneth Bialo, James Heavner, Jr., R. Stan Mortenson, and associates Nicholas Brady, Ryan Bull, Benjamin Kringer, and Matthew McCoy. (Barta, Mortsenson, Brady, Bull, and Kringer are in the firm’s Washington, D.C., office. Bialo and McCoy are now with the New York-based firm Emmet, Marvin & Martin; Heavner is now at The Hartford Financial Services Group, Inc.)

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]

Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.