LOS ANGELES--(BUSINESS WIRE)--Yesterday the Court of Appeal denied Medley Capital Corporation’s emergency appeal and request to stay a nine-figure trial set for June 12, 2018 in Los Angeles Superior Court. At trial, Medley Capital Corporation (NYSE: MCC), as well as Congruent Investment Partners, LLC, and Main Street Capital Corporation, will face claims for breach of fiduciary duty and fraud in which the Plaintiff seeks damages in excess of $150 million.
Modern VideoFilm was previously one of the top post-production houses in Hollywood. It did post-production work on shows such as Game of Thrones, Modern Family and the Walking Dead. Its client list included HBO, ABC, Fox, Sony, Warner Brothers, Apple, Netflix, Amazon and Hulu. In 2015, the Plaintiff, Modern VideoFilm’s sole shareholder, Moshe Barkat, filed a lawsuit alleging that Medley Capital Corporation blocked a lucrative and important transaction with Technicolor and undertook a hostile takeover of Modern VideoFilm, in which it fired MVF’s CEO and founder. Those actions led to a mass exodus of key employees and clients, thus destroying the company.
The appeal had sought to stay the trial on the ground that the Court of Appeal should reverse the Superior Court’s ruling on Medley’s motion for summary judgment, which the Superior Court (the Honorable Daniel S. Murphy) denied in its entirety on April 11, 2018. In that ruling, the Superior Court found that there was evidence that Medley had “engaged in fraud,” participated in “unlawful, unfair, or fraudulent business acts,” employed “excessive control” over its borrower, and played a “substantial factor in the harm caused” to MVF.
Medley’s emergency appeal and request for stay alleged that the Superior Court’s ruling was made in error and that the Court of Appeal needed to intervene because “irreparable harm is imminent” if Medley were to face trial on June 12, 2018. Medley argued: “In June 2018, Medley will proceed to trial, facing a $100 million damages claim and the fees necessary to defend such a claim.” A three-judge panel of the Court of Appeal (Justices Perluss, Zelon, and Segal) promptly denied the appeal.
The Plaintiff is represented by Miller Barondess partners Skip Miller, Brian Procel and Christopher Beatty. Per Skip Miller: ”We very much look forward to our day in Court to right this wrong.”
See attached Motion for Summary Judgment Order (Case No. BC583437).