On June 23, 2009, Gibbs & Bruns achieved a record $1.7 billion settlement package for Huntsman Corporation in the widely followed trial of Huntsman’s claims against investment banks Credit Suisse and Deutsche Bank. Under the terms of the settlement, Credit Suisse and Deutsche Bank paid Huntsman $632 million cash and provided Huntsman with $1.1 billion of favorable financing through issuance of notes and bonds. This extraordinary result is an example of our ability to use speed, determination, and tireless effort to achieve results for our clients.
The case settled following a week of jury selection and an additional week of trial. Our opening statements attracted national attention as they offered jurors a window into how “these enormous investment banks wield enormous power” and told jurors they would have an opportunity at the end of the case to “send a message from Main Street in Conroe to Wall Street and the financial capitals of Europe.”
We were first retained to assist Huntsman in July 2008. Our initial task was to obtain discovery Huntsman needed to assist it in preparing to defend a lawsuit filed by its erstwhile merger partner, Hexion Specialty Chemicals. Hexion had filed suit in Delaware seeking to terminate the merger based, among other things, on the fact that Credit Suisse and Deutsche Bank, who had committed $15 billion to fund Huntsman’s merger, were unlikely to do so because the combination of Huntsman and Hexion would allegedly result in an insolvent company. We immediately took the depositions of the Credit Suisse and Deutsche Bank witnesses and then appeared at the Delaware trial and cross-examined one of the bankers from Credit Suisse. The evidence we developed during the Delaware trial was discussed at length in the Delaware court’s opinion, which found in favor of Huntsman and ruled that Hexion had intentionally breached the merger agreement.
Based upon the evidence developed in the Delaware proceeding, Gibbs & Bruns then filed suit against Credit Suisse and Deutsche Bank in Texas alleging fraud, fraudulent inducement, and tortious interference with Huntsman’s merger agreement with Hexion and with an earlier merger agreement between Huntsman and Basell. We obtained an immediate TRO prohibiting the Banks from taking any further action to interfere with the merger. We then conducted a two-day evidentiary hearing, at which the Banks were defended by Cravath Swain & Moore and Baker Botts. The firm achieved two critical pretrial victories for Huntsman following this hearing. First, the district court denied the Banks’ argument that a New York forum selection clause in their commitment letter required Huntsman to litigate its claims against them in New York. Second, the district court found that there was an imminent risk of irreparable injury to Huntsman if the Banks were permitted to file a preemptive suit in New York, alleging – as Hexion had earlier alleged – that the combination of Huntsman and Hexion would be insolvent. The trial court therefore enjoined Credit Suisse and Deutsche Bank from filing any such lawsuit prior to the closing of the merger. The Banks appealed that injunction, but we again prevailed on behalf of Huntsman and obtained a decision that not only affirmed the injunction but inflicted serious strategic damage on the Banks’ later defense of the underlying lawsuit.
Following the temporary injunction proceedings and the appeal, the firm conducted expedited discovery against the Banks and headed towards trial in June 2009. Between February and May 2009, the parties conducted approximately 90 depositions and completed full expert discovery. The firm then successfully defended seven summary judgment motions filed by the Banks. Jury selection began on June 5, 2009, and the case settled favorably for Huntsman after one week of testimony.
Click here to access The American Lawyer article detailing Gibbs & Bruns’ opening statements.
Click here to access The Texas Lawyer article detailing the case background.