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Lackey Hershman Obtains $21.5 Million Jury Verdict Against Royal Bank of Canada


Lackey Hershman Obtains $21.5 Million Jury Verdict Against Royal Bank of Canada

DALLAS, March 13, 2013 /CNW/ - Lackey Hershman, LLP obtained a $21,565,000 million jury verdict in favor of its client, Highland Capital Management, L.P. (Highland), on March 13, 2013, and against RBC Capital Markets, LLC, which is part of the Royal Bank of Canada (RBC). The verdict, which was rendered in the 95(th )Judicial District, Dallas County, Texas, followed a 7-day trial arising out of RBC's failure to settle a securities trade on March 14, 2001. When pre-judgment interest is included, it is anticipated that the judgment entered against RBC will be approximately $45 million.

RBC was represented by Seward & Kissel, LLP, from New York, New York, and Carrington, Coleman, Sloman & Blumenthal, L.L.P., from Dallas, Texas.

The jury returned its verdict on the morning of March 13, 2013, after approximately two-and-a-half hours of deliberation. The case stemmed from RBC's alleged refusal to settle a securities trade. Highland alleged that on March 14, 2001, RBC Capital Markets, LLC, f/k/a RBC Dominion Securities Corp., agreed to a trade whereby Highland purchased seven deeply subordinated three-year promissory notes from RBC with an aggregate face value of $45.4 million for 52.5 cents on the dollar (or a 47.5% discount). The notes were issued by McNaughton Apparel Group, Inc. (McNaughton), a publicly traded company. Highland alleged that RBC informed Highland on March 20, 2001, that RBC would not be able to deliver the securities as promised, and refused to settle the trade. On April 16, 2001, it was publicly announced that Jones Apparel Group was acquiring McNaughton, and on June 19, 2001, the notes were paid off in full in conjunction with the closing of that acquisition.

"The jury verdict is an important one for the securities industry because it reaffirms that oral agreements to purchase and sell securities remain as binding and enforceable under New York law today as they have for more than 200 years," said Paul Lackey, the lead counsel for Highland. Jamie Welton, a partner at Lackey Hershman that tried the case for Highland, said, "The jury verdict against RBC is the result of years of hard-fought litigation through more than 9 different state and federal trial and appellate courts, and demonstrates Highland's unwavering commitment to litigate to judgment no matter what the stakes or how long it takes."

"This was an incredibly important case to the securities industry. This verdict validates the integrity on which our markets rely," said Mark Okada, Co-Founder and Chief Investment Officer of Highland Capital Management, L.P., who testified at the trial. "Lackey Hershman tried the case with lethal precision, and gave us a noticeably competitive advantage in the courtroom" said Scott Ellington, General Counsel for Highland Capital Management, L.P.

Highland was represented at trial by Paul B. Lackey, Jamie R. Welton, Kristin Miller-Reinsch, and Timothy J. Miller, from Lackey Hershman, LLP. Adam Warren, of the Chicago office of Duff & Phelps, testified as an expert on the applicable customs and practices in the securities industry, and fair market value of the notes, for Highland.

RBC was represented at trial by Michael J. McNamara, Jack Yoskowitz, and Thomas Ross Hooper, of Seward & Kissel, LLP, and Monica W. Latin and Tim Chastain, of Carrington, Coleman, Sloman & Blumenthal, L.L.P.

About Lackey Hershman, LLP:

Lackey Hershman, LLP litigates matters in state, federal, and appellate courts around the country. While the attorneys at Lackey Hershman, LLP have litigated almost every imaginable type of case, Lackey Hershman, LLP has particular expertise and experience in finance, healthcare, advertising, and contract disputes. Although Lackey Hershman, LLP's clients range from billion-dollar financial institutions to individual entrepreneurs, they have one thing in common – the desire for the most aggressive, creative, and effective representation in the country. Lackey Hershman, LLP's goal is to effectively, efficiently, and rapidly resolve its clients' problems, regardless of whether that resolution must take place in the public domain, the courts, the boardroom, or anywhere else. A litigation team from Lackey Hershman, LLP accepts nothing less than finding the optimal solution to any client's problem, regardless of the size of the client, the opponent, or the problem.

About Highland Capital Management, L.P.:

Highland Capital Management, L.P. is an SEC registered investment adviser specializing in alternative fixed income investment strategies, and is one of the largest and most experienced global alternative credit managers in the world. An industry leader, the firm invests across all assets to the benefit of its investors in hedge funds, long-only commingled funds, separate accounts, private equity, and collateralized loan obligations. The firm has offices located in Dallas, New York, London, Singapore, and Seoul.

Paul B. Lackey, Lackey Hershman, LLP, 3102 Oak Lawn Avenue, Suite 777, Dallas, Texas 75219, Telephone, +1-214-560-2201, Telecopier, +1-214-560-2203, pbl@lhlaw.net, Jamie R. Welton, Lackey Hershman, LLP, 3102 Oak Lawn Avenue, Suite 777, Dallas, Texas 75219, Telephone, +1-214-560-2201, Telecopier, +1-214-560-2203, jrw@lhlaw.net

SOURCE: Lackey Hershman, L.L.P.

To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/March2013/13/c4788.html

CO: Lackey Hershman, L.L.P. ST: Texas NI: FIN LAW VERDICTS LAWVIEWS

-0- Mar/13/2013 20:39 GMT

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