Bloomberg News

Sullivan & Cromwell, Goodwin Procter: Business of Law

August 27, 2013

Sullivan & Cromwell LLP represented Amgen Inc. (AMGN:US) in its $10.4 billion acquisition of Onyx Pharmaceuticals Inc. while Goodwin Procter LLP represented Onyx.

Sullivan & Cromwell attorneys on the deal were Frank Aquila, Matthew Hurd and Sarah Payne, corporate; Matthew Friestedt, executive compensation and benefits; John Estes, financing; Ronald Creamer Jr., tax, and Nader Mousavi, intellectual property, along with special counsel Spencer Simon, intellectual property, and Matthew Brennan, environmental.

The Goodwin team representing Onyx was led by Stuart Cable and included James Matarese, Bradley Bugdanowitz, Lynda Galligan and Danielle Lauzon.

Amgen will pay $125 a share for Onyx’s outstanding stock, the companies said in a statement Aug. 25.

The deal gives Amgen access to a rapidly expanding cancer-drug market with a new product that offers revenue. Onyx’s Kyprolis, approved last year for a rare blood cancer, may spur more than $3 billion in revenue by 2021, according to analyst estimates compiled by Bloomberg. South San Francisco-based Onyx is now studying the medicine in an expanded group of patients.

Gibson Dunn & Crutcher LLP partners Barbara Becker and Dennis Friedman represented Lazard Ltd., one of Amgen’s financial advisers. Bank of America also was a financial adviser to Amgen and while Centerview Partners was a financial adviser to Onyx.

For more on the deal, click here.

Davis Polk, WilmerHale Work on Bats-Direct Edge Deal

Davis Polk & Wardwell LLP and Wilmer Cutler Pickering Hale & Dorr LLP worked on the merger of Bats Global Markets Inc. and Direct Edge Holdings LLC, which was announced yesterday. The deal unites two of the biggest American exchange operators amid a four-year decline in volume.

Davis Polk lawyers advising Bats are Leonard Kreynin, corporate; Kathleen L. Ferrell and Neil Barr, tax; Jean M. McLoughlin, executive compensation; Annette L. Nazareth, financial institutions; and Michael N. Sohn and Ronan P. Harty, antitrust.

The WilmerHale team advising Direct Edge includes Stephanie Evans, corporate; James Lowe and Lee Greenfield, antitrust; A. William Caporizzo, tax; Bruce Newman, regulatory and R. Scott Kilgore, employment.

Joe Ratterman, the chief executive officer of Bats, will keep that role at the combined firm, while Direct Edge CEO William O’Brien will be president. Financial details weren’t disclosed.

Formed by some of the fastest traders on Wall Street, the closely held companies have watched volume dry up in the U.S., cutting profits at the proprietary trading firms they count among their biggest customers. Shares changing hands on all U.S. exchanges have fallen 36 percent since 2009 to 6.3 billion shares a day in 2013 and profits for high-frequency traders slipped 80 percent, according to data compiled by Bloomberg and Rosenblatt Securities Inc.

The companies’ four exchanges will keep operating, using Bats’s technology, according to a statement. The combination will be headquartered near Kansas City, Missouri. Bats is based in Lenexa, Kansas.

In the Courts

Billionaire Blavatnik Wins $42.5 Million JPMorgan Judgment

Billionaire Leonard Blavatnik won a $42.5 million breach of contract award against JPMorgan Chase & Co. (JPM:US) over claims that because the bank put risky mortgage securities in a fund, he lost 10 percent of his $1 billion investment. Blavatnik lost a negligence claim against the bank.

Blavatnik, 56, ranked 51st on Bloomberg’s billionaires index with a net worth of $15.6 billion, sued JPMorgan in 2009 in New York State Supreme Court in Manhattan, accusing the biggest U.S. bank by assets of putting more money into mortgage securities in his CMMF fund than investment guidelines allowed.

Justice Melvin Schweitzer, who presided over a two-week trial this year, ruled that J.P. Morgan Investment Management breached its contract with Blavatnik’s CMMF fund by exceeding a 20 percent cap on mortgage securities. The judge awarded $42.5 million in damages plus interest, in a ruling dated Aug. 21 and made public yesterday.

J.P. Morgan Investment Management classified some mortgage investments in the account as asset-backed securities, increasing the amount of the fund’s mortgage assets to as much as 60 percent of the portfolio, Schweitzer said.

“Whether JPMIM had its own understanding that the ‘asset-backed securities’ category included some types of mortgage-backed securities is of no moment,” Schweitzer said. “There is no evidence that this was ever communicated to CMMF during the negotiations.”

“I hope that this decision sends a clear message to JPMorgan that they have to honor their obligations to their clients,” Blavatnik said.

Schweitzer found in favor of J.P. Morgan on Blavatnik’s claim of negligence and breach of fiduciary duty, saying that evidence shows that the securities were “relatively safe and desirable” at the time they were bought.

“We are pleased the court rejected CMMF’s negligence claim and found that our investment professionals lived up to their responsibilities,” Doug Morris, a spokesman for JPMorgan, said in a statement. “We respectfully disagree with the court’s interpretation of our agreement with CMMF and are considering our options regarding that finding.”

The case is CMMF LLC v. J.P. Morgan Investment Management Inc., 601924-09, New York State Supreme Court (Manhattan).

Jets, Giants Say Judge Letting Them Pursue Meadowlands Lawsuit

The New York Jets and Giants football teams said they won a court ruling allowing them to pursue a lawsuit against the developers of a retail and entertainment center at New Jersey’s Meadowlands Sports complex.

State Court Judge Peter E. Doyne in Hackensack, New Jersey, yesterday denied requests he throw out the case filed in May. The two National Football League teams accuse the New Jersey Sports and Exposition Authority of breaching a 2006 cooperation agreement and accused the developers of interfering with that pact.

A copy of Doyne’s ruling was provided by the teams to Bloomberg News and couldn’t be independently verified through court records.

“We look forward to the case proceeding,” the Giants and Jets said in a joint statement.

Dubbed the American Dream, the project is an outgrowth of an earlier plan known as Xanadu that gave rise to the 2006 accord, after which the teams collaborated on a $1.6 billion share facility known as MetLife Stadium, which opened in 2010.

The revamped and enlarged development plan would create the world’s largest mall, totaling 7.5 million square feet and attracting 55 million people a year, Doyne said in his ruling, citing one of the developer’s claims.

At issue is to what degree the expanded plans will adversely affect the teams on game days.

The teams can proceed on their interference claim against the developers, the judge said. The court dismissed a previous version of the teams’ suit a year ago, concluding it was prematurely filed.

The developers sued the teams for obstructing their plans last month.

“The only thing ‘new’ is that the judge denied the team’s request for an injunction and construction can/will go forward,” Alan Marcus, a spokesman for developers including Triple Five Worldwide Development Co., Ameream LLC and other entities, said yesterday in an e-mailed statement.

The teams’ case is New Meadowlands Stadium Co. v. Triple Five Group Ltd., BER-C-156-13, Bergen County, New Jersey, Superior Court, Chancery Division. The developers’ case is Ameream LLC v. New York Football Giants Inc., Bergen County, New Jersey, Superior Court, Law Division (Hackensack).

Law Firm Moves

Environmental Protection Agency Lawyer Joins McDermott

Jacob Hollinger is joining McDermott Will & Emery LLP as a partner in its energy advisory practice in New York.

Hollinger had been at the U.S. Environmental Protection Agency, where he was senior attorney for all Clean Air Act enforcement, litigation, permitting and rulemaking matters for Region 2, which includes New York and New Jersey in its jurisdiction.

Before the EPA, Hollinger was an assistant attorney general for the State of New York and New York’s lead litigation counsel in several complex environmental and energy-related matters, including a federal Clean Air Act trial.

Nixon Peabody Adds Employee Benefits Lawyer in San Francisco

Karen Ng has joined the San Francisco office of Nixon Peabody LLP. Previously she led the employee benefits practice at Sedgwick LLP.

According to a statement from the firm, Ng focuses on the structuring and financing of transactions involving employee stock ownership plans, as well as the role of ESOPs and other benefit plans in corporate mergers, acquisitions, IPOs, restructurings and ownership succession arrangements.

Her practice also extends to all aspects and types of employee retirement plans, welfare benefit plans and executive compensation.

To contact the reporter on this story: Ellen Rosen in New York at erosen14@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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Companies Mentioned

  • AMGN
    (Amgen Inc)
    • $127.39 USD
    • -2.62
    • -2.06%
  • JPM
    (JPMorgan Chase & Co)
    • $57.67 USD
    • -1.24
    • -2.15%
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