Preston Hollow Capital Gratified by Delaware Chancery Court’s Finding That Nuveen Used ‘Threats and Lies’ to Stifle Competition in Municipal Bond Market

– Ruling Affirms that Nuveen Undertook a Systematic, Destructive Campaign Against Smaller Rival, Preston Hollow Capital –

DALLAS--()--Preston Hollow Capital (“PHC”), an independent specialty municipal finance company based in Dallas, today outlined its response to the recent ruling by the Delaware Chancery Court, which found Nuveen guilty of using “threats and lies in a successful attempt to damage [PHC] in its business relationships.” The ruling was delivered on Thursday, April 9, 2020 in a 60-page Memorandum Opinion from Vice Chancellor Sam Glasscock III. Vice Chancellor Glasscock found Nuveen liable for the anti-competitive and injurious actions of its team led by Nuveen Head of Municipals, John Miller, in intentionally and illegally interfering with PHC’s business relations with its primary lender and six major Wall Street investment banks.

Jim Thompson, Chairman and Chief Executive Officer of Preston Hollow Capital, stated, “Municipal borrowers deserve a truly competitive marketplace where they are able to select the capital provider that meets their needs in funding their vital projects, not the needs of a large money manager like Nuveen. This is, in essence, the very injustice that the Vice Chancellor exposed. His ruling meticulously details Nuveen’s campaign of anti-competitive, untruthful, unfair and destructive conduct carried out by Miller and his team against Preston Hollow in our marketplace. It’s important to remember that the real ‘winners’ are municipal borrowers across the country, as we expect Nuveen to heed the Court’s stern admonition that it would be ‘exceedingly unwise for Nuveen to mount a similar campaign of malicious behavior’ against Preston Hollow going forward.”

Nuveen’s Anti-Competitive Conduct

The Court’s ruling painstakingly reveals Nuveen’s organized, methodical attack against its smaller rival, which Miller had come to view as a competitive threat. In the words of the Court:

The facts revealed in litigation … show that as Preston Hollow was becoming a contender in the high-yield municipal bond market, Nuveen, the self-styled “largest high-yield [municipal] fund in the world,” sought an industry-wide agreement not to conduct business with Preston Hollow. Although part of Nuveen’s motive was its interest in ‘seeing all the deals,’ its behavior shows that its object was also an attack directed at Preston Hollow’s ability to operate. The evidence demonstrated an aggressive and widely dispersed campaign to use almost any pressure necessary to cut off a competitor from its chief source of business as well as its financing. I find that Nuveen was not simply attempting to achieve a competitive edge; it meant to use the leverage resulting from its size in the market to destroy Preston Hollow. [Memorandum Opinion, p. 51]

These and related findings made by the Court reflect intentional anticompetitive conduct of the kind often punished by regulators charged with supervision of financial markets.

Nuveen’s Pattern of Deceit Concerning Preston Hollow Capital

The Memorandum Opinion also catalogues the array of falsehoods about Preston Hollow that Miller and his team spread throughout the municipal marketplace:

[The Nuveen witnesses’] circumlocutions for falsehoods—“hedge,” “bluff,” “exaggeration,” “role-play,” “scenario,” “overstatement,” “blustering,” “short-cutting,” “puff,” “shorthand,” “overblowing”—in situations where more quotidian creatures would simply say “lie,” might make one doubt that the latter word is in their vocabulary. Their testimony was generally that institutional investors and their bankers speak in an argot of forceful misstatements that all parties involved know is posturing, so that no real untruth is conveyed. Perhaps. Far more likely is that institutional investors, like the rest of us Yahoos, make statements of fact, true or false, with the intent to be believed. In this post-trial Memorandum Opinion, I find that Nuveen used threats and lies in a successful attempt to damage the Plaintiff in its business relationships. [Memorandum Opinion, pp. 1-2]

The Vice Chancellor lays down withering criticism of Nuveen’s trial witnesses’ credibility, characterizing their explanations as “both self-serving and disingenuous.” [Memorandum Opinion, p. 39]:

Preston Hollow’s Next Steps

The Vice Chancellor’s Opinion significantly advances Preston Hollow’s defamation claim for monetary damages that is pending in Delaware Superior Court, which Preston Hollow will vigorously pursue. Preston Hollow believes the Opinion also paves the way for a separate action under the Donnelly Act antitrust statute and its federal analog, the Sherman Act, since the Court declined to rule on a Donnelly Act claim advanced by Preston Hollow because it did not believe it was the correct forum for that claim.

“It’s troubling that Nuveen continues to publicly embrace and promote these executives right after their wrongful behavior has been exposed in a blistering opinion from a nationally respected jurist,” added PHC’s Thompson, commenting upon Nuveen’s post-ruling media statement.[1] “Regrettably, this sort of culture of unaccountability can incubate the very type of malicious, destructive behavior the Court found here.”

Preston Hollow is grateful to its stellar legal team, led by Dave Wollmuth and Scott Thompson of Wollmuth Maher & Deutsch and R.J. Scaggs of Morris, Nichols, Arsht & Tunnell. The Company will continue to seek justice for Nuveen’s misconduct, while continuing to provide borrowers in the municipal marketplace with the kind of certain and innovative capital that meets their needs.

About Preston Hollow Capital

Preston Hollow Capital ( is the leading solution provider in municipal finance. Headquartered in Dallas, Preston Hollow Capital is an independent municipal finance company with over $1.8 billion in permanent equity capital and over $3.6 billion in investment capacity from a diverse investor base comprised of founding management, institutional investors including funds managed by Stone Point Capital LLC and HarbourVest Partners, and several prominent family offices. Since being founded by Chairman & CEO Jim Thompson in 2014, PHC has closed more than $2 billion in transactions across a variety of sectors of the municipal bond market including healthcare, real estate, K-12 and higher education, infrastructure, senior living, general government and economic development. PHC differentiates itself with its ability to deliver capital with speed, certainty and flexibility.

[1] In a statement to The Bond Buyer, a Nuveen spokesperson said, “[W]e continue to fully support John Miller and his entire team, who can continue delivering strong investment performance on behalf of our clients.” Nuveen used ‘lies’ and ‘threats’ to damage rival Preston Hollow: Judge; The Bond Buyer, April 10, 2020.


Greg May, Preston Hollow Capital, LLC



Greg May, Preston Hollow Capital, LLC