2005 Year in Review

Carter Ledyard & Milburn llp
Partners for Your Business®
2005 Year in Review
2005 Year in Review
Letter to Clients and Other Friends
1
International Reach
2
Class of 2005
5
Intellectual Property
6
Art Law
7
Real Estate
8
Environment and Land Use
9
Winning Strategies
10
Compensation and Benefits
11
Business Clients Grow
12
Money Matters
13
Trusts and Estates
14
Tax-Exempt Organizations
15
Civic Priorities
16
Carter Ledyard & Milburn llp
Partners for Your Business®
To Our Clients and Other Friends
The world grows smaller every year. We live and work in a
global economy, and our firm has become more international.
Increasingly, we act as full-service U.S. counsel for overseasbased companies and individuals seeking to do business
here. We represent clients from Australia, Bermuda, Canada,
Denmark, Ireland, Israel, Italy, Japan, Switzerland, the
United Kingdom and other countries. Last year our work for
these clients included M&A transactions, equity offerings,
intellectual property matters, establishment of exchange
traded funds, real estate transactions, litigation and, for
overseas individuals, U.S. aspects of estate planning.
To reflect our vital relationships with foreign companies,
individuals and law firms, and the growing importance of our
global legal networks Legalink and Meritas, we have devoted a
substantial portion of this Review to articles that appear under
the heading Gateway to Americasm.
We worked on the same kinds of matters for our domestic
clients, as well as on such diverse matters as the
redevelopment of Lower Manhattan and the West Side, clean
energy projects, litigation over trade secrets and individual
financial planning.
Throughout, we have tried to provide the personal attention
that all clients deserve. We are pleased to be part of our
clients’ plans, transactions and successes, a representative
sampling of which follows. This Year in Review is presented
with thanks to our valued clients and other friends.
— Carter Ledyard & Milburn LLP
Gateway to Americasm
United Kingdom
Orient-Express Hotels Ltd. (NYSE: OEH) sold
5,050,000 of its class A common shares for
We are proud to offer the Gateway to
net proceeds of approximately $122 million
Americasm to offshore businesses and
and Sea Containers Ltd. sold 4,500,000
individuals. We are a full-service Wall Street
class A common shares of Orient-Express
law firm practicing for over 150 years. Yet,
for net proceeds of approximately $109
we have not grown too big for our clients,
million. Merrill Lynch and Citigroup Global
and we pride ourselves on the personal
Markets Inc. were the underwriters in this
service we still offer.
joint offering.
Denmark
Sea Containers Ltd. (NYSE: SCRA and
Danisco A/S (Copenhagen: DCO), the
SCRB) sold all its remaining 9,903,300 class
world’s premier food ingredients producer,
A common shares of Orient-Express for net
acquired control of Genencor International,
proceeds of approximately $302 million.
Inc. (Nasdaq: GCOR), the industrial and agriprocessing enzymes company, in a $615
million agreed public tender offer and private
acquisition of the shares formerly held by
Eastman Chemical Company.
Dako A/S, a leading cancer diagnostics
company, signed a distribution and
development agreement with Clarient,
Inc., a cancer diagnostics services
and technology company. Dako plans
leading children’s entertainment providers
that owns the rights to BARNEY®, BOB THE
BUILDER® and THOMAS® brands, was sold
to private equity sponsor Apax Partners for
approximately £490 million.
Coal International plc purchased the shares
of King-Coal Corporation Limited and Maple
Coal Co. Limited for £30 million.
to distribute Clarient’s Chromavision
King-Coal Corporation Limited acquired out
Automated Cellular Imaging System (ACIS®)
of bankruptcy the coal reserves, mining
as a supplement to its suite of automated
permits and related assets of Gauley Eagle
diagnostics equipment.
Holdings Inc. in West Virginia.
Ireland
U.K.-based clients Financial Dynamics,
Using cash raised in its 2004 PIPE (private
investment in public equities) financing,
Trinity Biotech plc (NASDAQ:TAB), an
Irish diagnostic company, completed its
acquisition of Primus Corporation’s business
of analytical systems used for diagnosing
and monitoring patient health.
2
HIT Entertainment Plc, one of the world’s
Incisive Media plc, and United Business
Media plc made the acquisitions described
on page 12 of this Review.
Australia
Deepgreen Minerals Corporation Limited,
a company with coal interests in West
Virginia, sold its U.S. subsidiary in West
Virginia to King-Coal Corporation Limited.
Italy
We assisted Maranello-based Ferrari
S.p.A. in a novel class action brought by
Israel
disgruntled fans who attended the U.S.
Magal Securities Systems Ltd. (NASDAQ:
Grand Prix Formula One car race held at
MAGS) made a public offering of ordinary
the Indianapolis Motor Speedway in June.
shares underwritten by Lehman Brothers.
Disappointed ticket holders sought millions
of dollars in damages for refunds and travel
costs when several racing teams declined
to race at the last minute citing safety
concerns. The case will test whether ticket
We acted as U.S. counsel to Elscint Limited
(NYSE: ELT) in connection with its merger
with Elbit Medical Imaging Ltd. (NASDAQ:
EMITF).
holders have a right to witness a particular
WorldGroup Holdings Ltd. took its affiliate
quality or composition of a sporting event or
Robomatix Technologies Ltd. private.
only the right to access a venue to witness
Robomatix markets and sells first aid kits
whatever occurs.
for the automotive industry in Germany
We successfully obtained the dismissal of
a multimillion dollar claim against our client
International Forest Products S.r.l., an Italian
hardwood manufacturer. The client was in
the midst of a dispute with a supplier in Italy
when the supplier filed a second suit against
the client in the supplier’s home state of
Mississippi. The case was dismissed on
the grounds of forum non conveniens and
and provides service for communications
systems in Israel. Its shares had been listed
on the OTC Bulletin Board, and affiliates
of WorldGroup held about 49% of them.
WorldGroup consummated a cash tender
offer for all the publicly-held shares. As a
result, Robomatix was able to deregister
its shares and terminate its public reporting
obligations in the U.S.
international abstention, legal doctrines
We acted as U.S. counsel for a number
designed to prevent forum shopping abuse
of Israeli companies in PIPE financings,
and the inevitable inequities in pursuing
including Attunity Ltd. (NASDAQ: ATTU),
claims over the same subject matter in
Defense Industries International, Inc.
multiple jurisdictions.
(OTCBB: DFNS), LanOptics Ltd. (NASDAQ:
LNOP), Mer Telemanagement Solutions Ltd.
(NASDAQ: MTSL) and RADA Electronic
Industries (NASDAQ: RADI).
We manage trademarks for Teva
Pharmaceuticals Industries Ltd. (NASDAQ:
TEVA) and represent it in trademark
disputes.
3
Gateway to Americasm
StarPoint Energy Ltd. had a whirlwind 2005.
In January, it completed its transformation
into StarPoint Energy Trust and, by the
end of the summer, had closed two major
property acquisitions for over CDN $700
million in cash (paid largely out of the
proceeds of cross-border financings) and
had acquired, by merger, A.P.F. Energy
Trust. During the last quarter of the year,
it received approval from its unitholders
to combine, in a merger of equals, with
Acclaim Energy Trust.
Calgary-based Walton International Group,
Inc., a privately-held real estate investment
Canada
and management company with over
twenty-five years experience in land banking
We are frequently the preferred choice as
and several offices throughout Canada
United States counsel for cross-jurisdictional
and Asia, expanded its operations into
Canadian offerings, often acting as “counsel
the United States by opening an office in
to counsel,” and advising leading law firms
Phoenix. Its initial focus in the U.S. will
throughout Canada about U.S. securities
be on syndicating properties located in
laws and lore. 2005 was another banner
Arizona’s “Golden Corridor,” which runs
year for our Canadian clients, especially
from Phoenix to Tucson.
those in the energy sector where the prices
of oil and natural gas were at record levels.
In addition to increased activity in crossborder financings, we assisted clients in a
number of significant merger and acquisition
transactions.
It was a busy year for Chamaelo Energy
Inc.: it reorganized to form Vault Energy
Trust (TSX: VNG) and Chamaelo Exploration
Ltd. (TSX: CXN), and had several successful
financings and a major acquisition through
a business combination with two private
companies completed January 6, 2006.
Sequoia Oil & Gas Trust (TSX: SQE) was
created in April and, in September, acquired
Dynamic Oil & Gas, Inc., a TSX and Nasdaq
listed company.
4
We advised Edmonton-based EPCOR Power
L.P. (TSX: EP.UN) on New York State
regulatory issues arising from its $529
million acquisition of a controlling interest
in TransCanada Power, L.P., the operator of
11 power generation plants, including two
located in New York.
In many of our transactions, we are asked
to expand our service to include tax advice,
frequently on sophisticated cross-border
issues.
Class of 2005
Austin D. Keyes was elected
partner in January. His
corporate practice has ranged
from M&A and joint ventures
to employment, shareholder,
investment and general
Bermuda
We represented Sea Containers Ltd.
(NYSE: SCRA and SCRB), a container
lessor and shipping company, in a multimillion dollar dispute with General Electric
arising out of the parties’ joint venture
to lease shipping containers. Though the
joint venture’s business has been quite
successful, disputes have arisen over
its management and direction. When
it appeared that GE would unilaterally
terminate the parties’ arrangement and seek
to take over management of the operation
based on unresolved claims of breach of the
joint venture agreement, we successfully
obtained a restraining order to maintain the
commercial contracts and agreements. Austin
received his B.A. with honors from Trinity
College and his J.D. from Fordham University
School of Law.
With ten years experience at the
EPA, new counsel Christine A.
Fazio’s environmental practice
includes litigation, land use,
environmental impact analyses,
project permitting, administrative
proceedings and regulatory compliance. Christine
received her B.A. from the University of Rochester
(magna cum laude), her M.P.A. from New York
University and her J.D. from Fordham University
School of Law (cum laude).
status quo until an arbitrator could carefully
John J. Hanley, named counsel,
consider the facts and make a determination
focuses his corporate practice
concerning the breach claims.
on the representation of hedge
Switzerland
We advised Banca Del Gottardo, a private
funds, investment banks, trading
desks, and special purpose
vehicles in the purchase and
Swiss bank, regarding class action
sale of distressed assets. He has negotiated and
allegations against it and hundreds of other
documented transactions involving the transfer
commercial entities and individuals arising
of loans, securities and trade claims in the U.S.,
out of the September 11 terrorists attacks.
European, Latin American and Asia Pacific markets.
Plaintiffs, the estates of individuals who
John received his B.A. from John Jay College of
died in the attacks, claim the defendants
Criminal Justice (summa cum laude) and his J.D.
conspired with or allowed their facilities
from Fordham University School of Law.
to be used by terrorists in funding and
planning the attacks. Motions to dismiss
are underway, which will test what level of
proof a party must present to make these
types of allegations and to sustain the case
through the discovery phase.
New counsel Melinda
Poon‘s real estate practice
includes commercial sales
and acquisitions, commercial
leasing, mortgage loans,
real estate aspects of
corporate mergers and
acquisitions, general representation of taxexempt organizations in real estate and financing
matters, including tax-exempt bond financings,
and residential sales and purchases. Melinda
received her B.S. from New York University
(cum laude) and her J.D. from the University of
Pennsylvania Law School.
5
Intellectual Property
Copyrights and Trademarks
We obtained an order for Honeywell
International, Inc. enforcing a settlement
against Notiplex Securite Incendie, Inc.
in the United States District Court for the
District of Connecticut.
For the JRR Tolkien Estate, we stopped
distribution of storybooks infringing our
client’s LORD OF THE RINGS books, and
On behalf of MTS IntegraTRAK, Inc., we
successfully moved for a more definite
statement of copyright claim and for
dismissal of a Georgia Uniform Deceptive
Trade Practices Act claim, followed by
a successful offer of judgment resolving
federal and state cases brought in Atlanta
by Telemate.net Software, Inc.
Licensing
had the infringing books destroyed, without
We represented a healthcare company
need of litigation.
in licensing patented and proprietary
technology for several reproductive health
CL&M manages trademark and copyright
products.
portfolios aggregating thousands of marks
and works for clients such as Playtex
We represented a public relations agency
Products Inc., England’s United Business
in negotiations with several spokespersons
Media plc, Germany’s GfK US Holdings,
for healthcare products, and a cosmetics
Inc., and Israel’s Teva Pharmaceuticals
company in negotiations with a major
Industries Ltd., and represented these
retailer.
clients in successfully opposing numerous
registrations of infringing marks, and in
other trademark and copyright policing - stopping everything from infringing web
sites to infringing toy guns.
For example, we filed suit on behalf of GfK
US Holdings, Inc. against Affinity LLC in the
United States District Court for the Southern
District of New York, and stopped Affinity’s
use of ADNORMS and VISTA AD NORMS.
For NOP World Ltd., we stopped
the infringing use of NOP at
NationalOpinionPanel.com -- as well
as unrelated use of ADVOCACY and
ADVOCACY MULTIPLIER by Intrepid
Consultant Ltd. -- in both cases, without
litigation.
6
We represented a research company in the
Ukraine in licensing its stem cell patents to
a new company that will seek FDA approval
to make its discoveries available for patient
treatment in the U.S.
Art Law
On behalf of a Canadian art dealer, we
litigated the authenticity and value of a
rare vintage photograph by Andre Kertesz
and coordinated with Canadian counsel
prosecuting a defamation claim arising out
of the same dispute.
We litigated disputes over the ownership
of three sculptures created by the
renowned Hungarian artist Jan Yoors, the
ownership of more than 100 autographed
letters written and illustrated by Winslow
Patents
We filed a wide range of patent applications
for software and business methods involving
exchange traded funds, hedge funds,
financial structured products, portfolio
adjustment in response to volatility and non-
Homer between 1890 and 1910, and the
ownership of certain sculptures created by
Jacques Lipchitz.
We recovered a rare book illustrated by
William Blake stolen from a client over 50
years ago.
profit donation gifting.
For Marvel Characters Inc., we successfully
secured a utility patent on a SPIDER-MAN®
toy action figure that automatically swings
from building to building. We also secured
design patent rights in THE THING FEET -a role-playing toy for THE THING (in THE
FANTASTIC FOUR®) -- which emits earthshaking sounds with each foot fall.
We filed for and successfully obtained
patent protection in the complex mechanical
arts involving automotive components for
Japan’s Koyo Steering Systems of North
America, Inc.
We assisted a multinational chemical
company in establishing its internal patent
procurement program, including counseling
on patent infringement avoidance.
We handled patent due diligence in
numerous substantial transactions
involving medical diagnostic and treatment
devices, integrated circuit technology, and
petrochemical processing technology.
7
Real Estate
Redevelopment
We represented the Lower Manhattan
Development Corporation in negotiating
Staircase in 48 Wall Street, new home of the
Museum of American Finance
Transactions
and preparing architectural and engineering
services agreements for the 9/11 World
Trade Center Site Memorial. These contracts
provide for architectural and engineering
services valued in excess of $30 million.
Collegiate Church Corporation created the
Madison Avenue Fund of the Collegiate
We represented the Empire State
Church to develop and implement charitable,
Development Corporation in its plan to
educational and religious outreach programs.
develop the proposed Jets stadium on the
The Fund was established through the sale
West Side of Manhattan, including the
of the Church’s property on East 67th Street
successful defense of ESDC in a New York
in Manhattan for a sale price in excess of
Supreme Court proceeding challenging the
$40 million. A substantial amount of the
project.
Foundation’s work will focus on social
Historic Preservation
welfare programs in New York City.
We advised private developers, government
We represented Reliance Figueroa
agencies and nonprofit organizations on
Associates in the sale of commercial
compliance with the National Historic
properties in three states for a sale price in
Preservation Act and Section 106, the State
excess of $30 million, structured as a tax-
Historic Preservation Act, and New York
free exchange.
City’s Landmark Law. We also advised a
The Museum of American Finance leased a
new home at 48 Wall Street. The Museum
is the nation’s only independent public
museum dedicated to entrepreneurship and
democratic free market traditions. Once
renovated, the Museum will house over
15,000 square feet of exhibit space, with
additional space for an auditorium and
meeting rooms.
Comprehensive Care Management
Corporation obtained more than $16 million
in a New York City Industrial Development
Bond financing. The bond proceeds will
be used to fund the improvements and
equipping of five day healthcare facilities for
the frail elderly and other frail persons.
8
private developer on how to proceed with
development plans involving a New York
City landmark and a nonprofit organization
on the threatened demolition of a New York
City landmark.
Environment and Land Use
Roosevelt Island: CL&M serves as
environmental counsel for the Roosevelt
Island Operating Corporation in connection
with a variety of residential and other
development projects, including the
landmark Octagon tower.
Urban Redevelopment
Rebuilding Ground Zero: As part of our
continuing work for the Lower Manhattan
Development Corporation, we advised
LMDC on the deconstruction of 130
Liberty Street, the redesign of the Freedom
Tower and construction of the Memorial
for September 11 victims and successfully
defended a court challenge to the WTC
Artist concept projecting
redevelopment plan. We also worked on a
Freedom Tower to be built on
proposed new East River esplanade.
the site of the World Trade
Center
Redeveloping Manhattan’s West Side:
CL&M successfully defended two lawsuits
Clean Energy
CL&M assisted the Long Island Power
Authority with environmental reviews
and permitting for generating units and a
transmission line to address summer peak
energy demands, a new 350-megawatt
combined-cycle plant in Suffolk County
and an off-shore wind turbine project to
provide energy to New York residents and
businesses. We also advised the New York
Power Authority with respect to major
clean energy projects throughout the State.
Clean Water
in New York Supreme Court challenging the
After 11 years of litigation and four
environmental review conducted by our client
successful trips to the Appellate Division,
the Metropolitan Transportation Authority for
CL&M secured all approvals necessary for
the redevelopment of the West Side. The
United Water New Rochelle Inc. to build a
City’s plan includes 40 million square feet
state-of-the-art potable water pump station
of mixed use space, extension of the No. 7
that will allow United Water to use the
subway line, new parks and open spaces,
Delaware Aqueduct as its primary water
an expanded Jacob K. Javits Convention
supply for more than 138,000 residents in
Center, and other improvements. We are
11 Westchester County communities.
currently defending a new lawsuit brought
in federal court against the Hudson Yards
rezoning plan.
Brownfields
We represented a privately held entity in
the acquisition of a 1,000-acre brownfield
Brooklyn/Atlantic Yards Redevelopment:
site from a chemical company in the
CL&M is environmental counsel to the
Southeast, and the former owner of one
Metropolitan Transportation Authority for
of New York State’s inactive hazardous
the Atlantic Yards Arena and redevelopment
waste sites in settlement negotiations with
project in Brooklyn. The project includes
the State Department of Environmental
the construction of an arena for use by the
Conservation.
Nets professional basketball team, as well
as apartments, offices, stores, a hotel, new
open space and a new railroad yard for
improved LIRR operations.
9
Winning Strategies
Creditors’ Rights
In a case that received wide publicity,
CL&M represented The Bank of New York
as collateral trustee in litigation over the
use by Calpine Corporation of over $313
million in proceeds from the sale of assets
that formed collateral for several series of its
secured notes. The case involved expedited
discovery, a trial on the merits in the Delaware
Acquisitions and Dispositions
Court of Chancery and an appeal to the
CL&M acted as counsel to SI Bank &
in three months. We continue to represent
Trust Foundation in connection with the
The Bank of New York in the bankruptcy
diversification by the Foundation of its
case that Calpine commenced after it was
portfolio through the sale of a large portion
unsuccessful in the Delaware litigation.
of its interest in Independence Community
Supreme Court of Delaware, all completed
Bank Corp., which the Foundation had
Commercial
acquired in 2004 when it acquired Staten
We persuaded the SEC not to require a
Island Bancorp. We assisted in implementing
public company to publish a shareholder
a “safe harbor” Rule 10b5-1 sales plan to
proposal in its proxy materials.
reduce the total value of Independence
shares in the Foundation’s portfolio from
We performed an internal investigation and
approximately 80% to approximately 25%.
advised a government agency concerning a
Bankruptcy
2005 saw the enactment of comprehensive
revisions to the Bankruptcy Code and
an increase in bankruptcy filings in the
Southern District of New York. We were
active in most of the largest cases, including
acting as local counsel for Skywest, the
principal commuter carrier for Delta, in that
airline’s bankruptcy case, representing The
Bank of New York as trustee on several
financings in the Northwest Airlines case
and advising a supplier on its options in
the Delphi bankruptcy case. We continued
to be involved in litigation in the Adelphia,
Enron and other large bankruptcy cases and
represented The Bank of New York and
other parties in the New World Pasta, Golden
bid solicitation and contract to deconstruct
a building in Lower Manhattan.
We advised a shipping line in an ongoing
dispute with the U.S. Department of Justice
over an antitrust amnesty agreement.
Maritime
We represented the Government of
Guyana in arbitration proceedings in New
York, presenting their claim that they
effectively exercised their option to extend
a contract of affreightment at a freight rate
substantially below the prevailing market
rate. We also asserted counterclaims for
detention, demurrage and failure to ship
the minimum quantities of cargo in the
preceding year.
Northwest. We assisted Radivision Ltd. in
We assisted in negotiating a contract of
acquiring First Virtual Communications out of
affreightment for carriage of bauxite and a
bankruptcy.
barging contract for carriage of bauxite from
the mine to a transshipment vessel.
10
Employment
Compensation and
Benefits
We successfully litigated cases involving
trade secrets, confidentiality and non-compete
agreements and fiduciary duty. We prosecuted
We drafted and helped design incentive
claims for injunctive relief and damages and
compensation plans, both cash-based and
advised clients on how to minimize risk in their
equity-based, for the senior management
recruitment efforts.
and other key employees of The Colibri
In federal court, we defended a national sales
manager against claims by his former employer
for breach of an employment agreement and
Group, Inc., Chandler Chicco Agency LLC,
Victaulic Company, and the Genencor
Division of Danisco A/S.
various business torts.
CL&M prosecuted in federal court a security
We provided advice as to outstanding stock
company’s claims against a former senior
options, restricted stock and unit awards
executive arising out of an employment
and stock appreciation rights in connection
agreement and asset purchase agreement.
with Danisco’s tender offer for Genencor
We defeated injunctive proceedings brought
by rival public relations firms against our client
Financial Dynamics in connection with its
International, Inc. and Exeter Capital IV’s
sale of its controlling stock interest in a
privately held company.
recent recruitment initiatives.
CL&M continued to press claims of trade
CL&M advised Fleming Family and Partners,
secret theft and breach of contract for
West End Capital Management and other
our client United States Trust Company,
private equity and investment fund clients
N.A. against former employees and a rival
in connection with structuring complex
investment management business.
investments for ERISA and IRA investors.
Goldman Sachs continued to rely on us not
only to enforce employee agreements, but also
to develop recruitment strategies.
We assisted banks and other financial
institutions in designing stable value funds,
We pursued arbitration for a breach of contract
synthetic GICs and other products suitable
claim against a former senior officer of Prebon
as investments for ERISA plans.
Energy, Inc., an inter-dealer broker.
11
Business Clients Grow
Private Equity
Buyout fund Founders Equity SBIC I, L.P.
which is the leading specialty and custom
and other private equity investors formed
chemical exhibition in the United States.
The Colibri Group, Inc. to purchase the
business and assets of Park Lane Associates,
Inc. Colibri Group designs and markets
branded jewelry, watches, lighters, clocks
and gift items, including COLIBRI® lighters,
Dolan-Bullock PASSPORT® jewelry, SETH
THOMAS® clocks and KREMENTZ® jewelry.
Debt financing was provided by HSBC and
Sovereign Bank.
Paperloop, Inc., a leading trade publisher
and exhibition organizer in the paper, pulp,
forest and converting industries, sold
the Converting Machinery and Materials
International Conference to Penwell
Corporation.
Mergers & Acquisitions
Pall Corporation (NYSE: PLL), the global leader
Financial Dynamics, a U.K.-based global public
in the fields of filtration, separations and
relations firm and portfolio company of private
purification, provides leading-edge products in
equity funds managed by Advent International,
biotechnology, pharmaceuticals, transfusion
acquired Dittus Communications, a leading
medicine, semiconductors, water purification,
public affairs firm in Washington, DC, and the
aerospace and broad industrial markets. Pall
business of Westhill Partners, a New York
sold to Satair A/S the exclusive rights of its
business and management consulting firm.
PAS division to distribute PALL® filters to the
commercial aerospace aftermarket in North,
Bermuda-based Flagstone Re, a global
Central and South America for approximately
reinsurance company formed in response to the
$27.5 million. We also assisted Pall in
2005 hurricane season, completed the initial
connection with a new enhanced five-year
round of a $715 million private placement of its
revolving credit agreement and a variety of
equity securities. We also advised and handled
securities law, compensation and other matters.
U.S. offerings for Consulta, Polar Capital,
Thailand International Fund, Fleming Family &
CooperSurgical, Inc., supplier of medical
Partners Funds and ICAP Private Equity.
devices, diagnostic products and surgical
accessories to the women’s healthcare
Generic pharmaceutical manufacturer
industry, acquired NeoSurg Technologies,
CorePharma LLC sold a majority equity
Inc., a supplier of breakthrough products
interest to RoundTable Healthcare Partners,
for minimally-invasive surgery, and Inlet
a private equity firm focused exclusively on
Medical, Incorporated, a supplier of minimally
the healthcare industry.
interventional laparoscopic products.
Trade Publishing and Exhibitions
Victaulic Company, the world leader in
Incisive Media plc, an AIM listed information
grooved and plain-end mechanical pipe
provider, invested $43 million to acquire
joining systems, concluded the reacquisition
from Jupitermedia Corporation (NASDAQ:
of its trade names and distribution businesses
JUPM) its search engine strategies
in Europe, the UK, Ireland and elsewhere
business, which is the premier international
worldwide.
conference series on search engine
marketing and optimization.
12
GFI Group Inc. (NASDAQ: GFIG), a
leading inter-dealer broker specializing in
CMP Media LLC, a subsidiary of U.K.-based
over-the-counter derivatives products and
media group United Business Media plc,
related securities, acquired the business of
invested $24 million to acquire from the
Starsupply Petroleum LLC, a leading broker
Synthetic Organic Chemical Manufacturers
of oil products and related derivatives and
Association the INFORMEX® trade show,
option contracts.
Money Matters
Funds
We advised funds, investment advisors,
index providers, financial intermediaries,
broker-dealers and stock exchanges
concerning domestic and foreign Exchange
Traded Funds (ETFs). Our client Finans
Portfoy developed the first Turkish ETF,
We obtained a favorable interpretive letter
which tracks the Dow Jones Turkey Titans
from the staff of the Commodities Futures
20 Index and is listed on the Istanbul
Trading Commission on behalf of our client
Stock Exchange. We also initiated several
Flextrade LLC. Now Flextrade can license
exemptive applications for clients to
its trading and order management software,
enable registered investment companies to
enabling customers to gather market data
purchase interests in their funds beyond
and place commodities futures orders, and
statutory limitations. As in past years,
enabling Flextrade to collect a license fee for
we consulted with international securities
each trade executed, all without registering
industry “fact-finding” groups concerning
with the CFTC.
dual listings, cross listings and public
offerings of foreign securities under the
U.S. securities regulatory scheme.
Structured Finance
We increased our activity in the tender
option bond market and now represent both
In the wake of the mutual fund scandals
The Bank of New York and U.S. Bank Trust,
in 2003, the SEC adopted regulatory
N.A. in connection with programs sponsored
changes designed to strengthen investment
by issuers including Citigroup, JPMorgan
company governance. We advised
Chase and Merrill Lynch. These municipal
independent directors of mutual funds
security derivative structures, issued
and sponsors of unit investment trusts on
by trusts holding longer-term fixed rate
the new rules, including the requirements
securities, create short-term floating rate
that fund boards have an independent
instruments suitable for tax-exempt money
chair, that there be enhanced disclosure of
market mutual funds.
advisory contract renewals, and that fund
compliance programs be adopted, as well
Distressed Debt
as on the best practices recommended in
We negotiated and documented the transfer
the Mutual Fund Directors Forum Report.
of more than $1.0 billion in distressed
debt, securities and trade claims on behalf
of hedge funds, trading desks and special
purpose vehicles. Our attorneys are actively
involved in establishing market practice and
developing industry standards through our
membership in the Loan Syndications and
Trading Association.
13
Trusts and Estates
Wealth Transfer and Tax
Planning
We shared a year of accomplished goals
with our individual clients in the planning
of their financial futures. From a Montana
rancher to the owner of a historic Nantucket
home, we guided our clients using
customized tax strategies to transfer wealth
within family groupings. One client will
keep a century-old business in the family
for a fourth generation through the careful
In the United States, we assisted charitable
use of family partnerships and long term
boards in developing improved governance
trusts. Another, a young entrepreneur, now
and compliance systems. In addition, we
has a tax-efficient plan to manage single
coordinated the terms of restricted gifts
stock risk, along with a wealth preservation
to public charities including universities
strategy to protect her family well into the
and a child services organization. We also
future.
mediated a dispute involving an endowment
to a major university.
Our clients included not only high net worth
individuals from the U.S. and overseas, but
Trusts and Estates Litigation
also family offices, trustees, both individual
Sometimes it is necessary to litigate to
and corporate, closely held companies,
protect the wishes of a donor and the
senior executives, investment advisors and
interests of a recipient. Our firm has
private and public foundations. In addition
extensive experience in proceedings to
to highly personalized tax techniques, our
protect our clients’ interests.
clients’ financial strategies included more
familiar trust arrangements such as grantor
We litigated in probate court claims against
retained annuity trusts (GRATs), asset
executors for breach of fiduciary duties and
protection trusts, personal residence trusts,
excessive compensation in settling a $300
and charitable trusts.
million estate.
One client achieved charitable goals while
We defended executors in New York
at the same time insuring that a cherished
Supreme Court and New York County
vacation retreat will be enjoyed by the next
Surrogate’s Court against claims of
generation with minimal transfer tax cost.
breach of fiduciary duties, negligence, and
Philanthropic Goals
Our clients’ charitable interests are diverse
and, for many, global in scope.
Internationally, we assisted a client in
advancing her goal of establishing a fine arts
museum in Morocco with an art collection
assembled from around the world. We
helped a foundation client expand its reach
in awarding international achievement prizes
in wide-ranging fields including women’s
rights and neuroscience.
14
malpractice.
On behalf of a trust beneficiary, we
successfully negotiated the recovery of $12
million from a trustee who borrowed against
the assets of a family trust.
On behalf of an estate beneficiary, we
litigated claims of undue influence in the
execution of a will and codicil in connection
with a $100 million estate.
Tax-Exempt Organizations
We represent the National Alliance for
Autism Research in a proposed combination
of operations with Autism Speaks Inc.
The organizations, which are two of the
leading organizations in the battle against
We assisted in creating many new tax-
autism, have signed a memorandum of
exempt organizations, dissolving some older
understanding and expect to conclude due
organizations and representing numerous
diligence and final board approvals in 2006.
other organizations with increasingly
complex activities. Our tax-exempt clients
have merged, split and changed location and
corporate form, and we have guided them
through both federal and state requirements
every step of the way. We advise on issues
ranging from the glamorous to the mundane,
providing assistance in every aspect of a
tax-exempt organization’s existence.
We continue to represent Beth Abraham
Health Services and its affiliates in
several kinds of activity, principally
helping Comprehensive Care Management
Corporation to lease, finance and build day
health care centers in New York City and on
Long Island.
We completed our representation this
year of Westbeth in the arbitration over
maintenance of the High Line railroad
In response to heightened regulatory and
public scrutiny of charitable organizations,
we conducted governance and compliance
audits for several organizations, including
a private foundation, a “friends of”
organization providing support for a foreign
university, and a U.S. organization operating
a school abroad.
We continue to represent many arts
organizations on numerous issues, including
authenticity, intellectual property and
catalogue raisonné issues, as well as on
a variety of tax issues relating to their
tax-exempt status. We also advised and
assisted numerous artists and their estates
in creating new private foundations for their
works of art.
Tax Services
structures at Westbeth, obtaining a six-
Our tax services included preparing and
figure arbitration award and defeating the
filing of gift, estate, income, and generation-
respondents’ efforts to overturn the award,
skipping federal and state tax returns. In
which has now been paid.
addition, we successfully advocated for
clients before the Internal Revenue Service,
We represented Eighth Church of Christ,
argued in Tax Court and negotiated with
Scientist in connection with restoring the
representatives of foreign tax authorities.
ceiling in its sanctuary, which contained a
form of asbestos.
We continue to advise the Museum of
American Finance concerning on-going
operations as a tax-exempt organization, as
well as its new lease for 30,000 square feet
of space in Lower Manhattan.
15
Civic Priorities
Big Brothers Big Sisters
We assisted Big Brothers Big Sisters of
New York City in the planning of the
“2005 Race for the Kids” event. We
negotiated the contract with the event
coordinator and reviewed sponsorship
agreements. The event draws a variety of
sponsorships, including local radio stations
and other media outlets, food and clothing
Big Brothers Big Sisters of New York City’s “2005
Race for the Kids”
of the race participants.
Patriot Act Litigation
CL&M prepared and filed an amicus brief in
Doe v. Gonzales on behalf of the Civil Rights
Committee of the Association of the Bar of
the City of New York, urging the Second
Circuit to affirm a lower court ruling finding
unconstitutional a provision of the USA
Patriot Act that permits the FBI, through
the use of National Security Letters, to
secretly collect customer information from
communications institutions, universities,
and libraries in cases of suspected terrorism
without any provisions for meaningful
judicial oversight. Doe v. Gonzales was
brought by an anonymous internet provider,
the American Civil Liberties Union, and the
American Civil Liberties Union Foundation.
We also represented BBBS in the
negotiations of a proposal to create a
holiday themed CD produced by the Big
Brothers Big Sisters of New York City
Choir, in exchange for a donation to the
BBBS scholarship fund. The CD would be
distributed along with a third party product
and sold by BBBS.
Environmental Clean-Up
Youth Ministries for Peace and Justice,
a Bronx-based community organization,
continued its efforts, with CL&M’s pro bono
help, to obtain a full cleanup of Starlight
Park, the site of a former manufactured gas
plant owned and operated by a predecessor
of Consolidated Edison Company of New
Clean Air
York, Inc.
CL&M represented, pro bono, the
Welfare Law Center Fellow
Environmental Integrity Project, Inc., Natural
Resources Defense Council, Sierra Club and
others in a federal court challenge to the
EPA’s relaxed rule for monitoring emissions
from industrial sources where that monitoring
is necessary to assure compliance with
emissions limits. In Environmental Integrity
Project et al. v. Environmental Protection
Agency, the United States Court of Appeals
for the District of Columbia Circuit upheld
the petition of CL&M’s clients and vacated
the final rule. Noting that it would not
permit agencies to “use the rulemaking
process to pull a surprise switcheroo,”
the court held the final rule constituted an
impermissible regulatory “flip-flop,” which
must be “preceded by adequate notice and
16
merchandisers and individual sponsorships
opportunity for public comment.”
In cooperation with the Equal Justice Works
public interest program, CL&M sponsored
a two-year fellowship at the Welfare Law
Center.
Attorney Directory
Questions or Comments
If you have any questions or
comments about any article,
kindly contact Cully Irving at
212-238-8714 or
[email protected], Jim Abbott
at 212-238-8720 or
[email protected], Tom Davis
at 212-238-8850 or
[email protected], Austin Keyes
at 212-238-8641 or
[email protected],
Daniel McSwiggan at
212-238-8760 or
[email protected], or
Maria Velazquez at
212-238-8670 or
[email protected].
James E. Abbott
Michele L. Abraham
Rita M. Antonacci
Joseph Asaro, Jr.
Rose Auslander
Howard J. Barnet, Jr.
Edmund J. Behan
Alan J. Bernstein
Sandra Bourgasser-Ketterling
Jeffrey S. Boxer
Barbara B. Brown
Stephen V. Burger
Aaron R. Cahn
Richard T. Califano
Lawrence F. Carnevale
Clifford P. Case III
John R. Casolaro
Jerome J. Caulfield
Jerome J. Cohen
Faith Colish
Richard B. Covey
H. Thomas Davis, Jr.
Michael C. Davis
William E. Donovan
Margaret M. Drohan
Matthew D. Dunn
Robert S. Erskine, Jr.
Christine A. Fazio
Peter Flägel
Lisa Factor Fox
Michael I. Frankel
James Gadsden
Karmit S. Galili
Amanda J. Gallo
Peter P. McN. Gates
Steven J. Glusband
G. Christina Gray
Robert R. Grew
Gerald W. Griffin
Raphael S. Grunfeld
Sian O’Malley Hahn
John J. Hanley
Adina B. Heino
Daniel Hirsch
Richard J. Horne
Macculloch M. Irving
Catherine M. Janasie
John M. Johnson
Susan B. Kalib
Jack Kaplan
David I. Karabell
Stephen L. Kass
Donald J. Kennedy
Austin D. Keyes
Peter K. Killough
Samantha Klein
Bram W. Kranichfeld
212-238-8720
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Stephen F. Lappert
Kenneth S. Levine
Judith A. Lockhart
Patricia Matzye
Jaime A. Maurer
Jean M. McCarroll
David M. McDonald
Daniel J. McSwiggan
Robert A. McTamaney
Paulina Mejia
Diane B. Melnick
Patrick A. Michel
Emily Milligan
George Minkin
Vincent Monte-Sano
Kathleen H. Moriarty
Barry S. Neuman
Leila I. Noor
H. Bertil Nordin
Lee A. Ohliger
Richard G. Pierson
Dan S. Pittman
Melinda Poon
James W. Rayhill
Laura A. Reeds
Della P. Richardson
Lindsay Richman
Robert M. Riggs
Christopher Rizzo
Jelani Y. Roper
Sharon Rosen
Joseph M. Ryan
Leila Safai
Karl R. Schaffer
Karen T. Schiele
Gary D. Sesser
Noah D. Shapiro
Pamela S. Shelinsky
Heywood Shelley
William H. Sloane
William F. Sondericker
Ronald D. Spencer
Ethan I. Strell
Mark D. Sullivan
Jean M. Tabberson
M. Antoinette Thomas
Leonardo Trivigno
Anna Maria Vistica
Andris J. Vizbaras
Theodore R. Wagner
Judith Wallace
John J. Walsh
Mary Beth Werner
Glen K. Westerback
Thomas J. Whalen
John K. Whelan
Mark R. Zancolli
212-238-8717
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