Thank you for sharing!

Your article was successfully shared with the contacts you provided.
OPINION REVEALS OLD FINANCIAL HITS TAKEN BY WEIL, GOTSHAL Weil, Gotshal & Manges got some good news in a long-running lease fight last week, when San Francisco’s First District Court of Appeal affirmed a $507,000 award the firm had won in a dispute with its landlord, for breach of contract. But the April 24 opinion also upheld a San Mateo County judge for finding no fraud on the landlord’s behalf, and denying the firm rescission. Oh, and the ruling also stands behind the judge � though unnamed in the opinion, trial court records indicate it was Judge Carol Mittlesteadt � for finding that neither party deserved attorneys fees because each prevailed in one way or another. “In such a case, where the results of the litigation are mixed,” Justice James Marchiano wrote, “the trial court may, in its discretion, declare neither side to be a prevailing party and deny both sides attorneys fees.” Justices William Stein and Douglas Swager concurred. The unpublished ruling ( .pdf) also offered up a few of the juicy details about how the lease, and the real estate climate, affected the firm’s finances. The ruling notes that Weil, Gotshal & Manges agreed in 2000 to pay nearly $9.4 million a year in rent, as well as an additional $11,000 a month for parking, at its Redwood Shores office. Then it adds that the New York-based firm suffered an annual shortfall of about $2 million when a downturn in the commercial real estate market in 2001 and 2002 prevented it from subleasing part of the office premises. The ruling also observes that the firm had to cut its budget by about $3.3 million to cover the shortfall and additional expenses. Weil, Gotshal sued its landlord, [email protected] Center, in 2004 for failing to live up to a contractual agreement to provide access-controlled parking for the firm’s employees, who would occupy the top four floors of the six-story building. The landlord gave up on the parking � a surface lot that would have had a manned booth � when it became obvious that the city wasn’t going to approve the concept. The Towers, as the complex is called, resorted to a parking garage with an access card system. After a bench trial, the judge found that the landlord had breached its contract and awarded the firm $507,000, the amount of money paid out for monthly parking charges as of May 31, 2005. But the judge declared there was no fraud involved because the landlord had sincerely intended to provide access-controlled parking. Weil, Gotshal argued that the trial judge denied the firm its constitutional right to a trial by jury on its fraud claim. Justice Marchiano agreed, but ruled that the firm had suffered no harm because the fraud claim was based on the same facts as the rescission claim � which the judge had handled properly. “Remand for a jury trial on the fraud claim,” he wrote, “would be pointless and an affront to judicial economy.” Last week’s ruling also makes one other thing clear: Weil, Gotshal has done well in Silicon Valley since arriving in 1992. It started with a four-lawyer office in Menlo Park, but by 2005 had about 60 lawyers in Redwood Shores. The ruling is Weil, Gotshal & Manges LLP v. [email protected] Center L.P., A112757.

Mike McKee

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]


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.