Venturetek, L.P. v Rand Publ. Co., Inc.
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Venturetek, L.P. v Rand Publishing Co., Inc. 2006 NY Slip Op 30387(U) March 8, 2006 Supreme Court, New York County Docket Number: 0605046/1998 Judge: Herman Cahn Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. NNED ON 311312006 [* 1 ] SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY PART PRESENT: Hon. 49- Justice The following papers, numbered 1 to were read on this motion tolfor Notlce of Motion/ Order to Show Cause - Affidavits - Exhibit8 ... I- Answering Affldavlta - Exhibits I Replying Affidavlts Cross-Motion: . Yes No Dated: J. a ba . Check one: ' FINAL DISPOSITION NON-FINAL DISPOSITION [* 2 ] SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: IAS PART 49 X _ _ _ _ _ _ _ - - - - - - I - - _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ I I _ _ _ _ VENTURETEK, L . P . , RICHARD ELKIN, ANTOINE BERNHEIM, STACY BERNHEIM, and GENSTAR, LTD., individually and as shareholders of Rand Publishing Co., Inc., Plaintiffs, Index No. -against- 605046/98 RAND P U B L I S H I N G C O . , INC., MASON P. SLAINE, MICHAEL E. DANZIGER, WARBURG PINCUS VENTURES, L . P . and E . M . WARBURG, PINCUS & CO., L.L.C., Plaintiffs' counsel, Jaroslawicz & J a r o s , Esqs., moves f o r an o r d e r (1) awarding them 3 0 8 of the settlement funds, which were recovered from defendants Warburg Pincus Ventures, L . P . and E.M.' Warburg, Pincus & Co., LLC (Warburg), as attorneys' fees; (2) awarding them $10,805.55 of the same settlement funds, as reimbursement for expenses; and (3) directing that the balance of the settlement funds remain in an interest-bearing checking account maintained either by Willkie Farr & Gallagher, Esqs., the counsel for Warburg, or by plaintiffs' counsel, until further order of this court. BACKGROUND The facts of this case have been detailed in several prior decisions and orders of this court, familiarity with which is presumed. Plaintiffs are shareholders owning 50% of Rand Publishing [* 3 ] Co., Inc. (Rand), a small information publishing company. In October 1998, plaintiffs brought the instant derivative suit against (1) defendants Mason P. Slaine and Michael E. Danziger, two of Rand's three directors who are the shareholders owning the remaining 50% of Rand, and (2) Warburg. Plaintiffs asserted claims against Slaine and Danziger for, inter alia, usurpation of corporate opportunities, breach of fiduciary duty, and the imposition of a constructive trust. Plaintiffs asserted claims against Warburg, which had formed a new, larger information publishing company with Slaine in December 1996, for tortious interference with contract and aiding and abetting a breach of fiduciary duty. In March 2005, at the conclusion of extensive discovery, all parties moved for summary judgment. While these motions were pending, the Warburg defendants agreed to settle the claims asserted against them for $750,000.00. A stipulation of settlement was marked "So Ordered" by this court on April 11, 2005 (= Jaroslawicz Aff., Exh. A). Pursuant to the stipulation of settlement, the settlement funds were placed in an interestbearing escrow account, currently being held b y Warburg's counsel. Plaintiffs' counsel, Jaroslawicz & Jaros, now seek to be awarded 30% of the settlement funds, as attorneys' fees, and $10,805.55, as disbursements. In support of the application, 2 [* 4 ] David Jaroslawicz, the lead counsel, has submitted affidavits averring that he undertook the action on a contingency basis, and has received no remuneration or reimbursement since this action began; that his firm has expended more than 1,000 hours in investigating and preparing the complaints, engaging in extensive motion practice, conducting depositions and discovery, and preparing for hearings and trial; and, that the recovery of the settlement funds from Warburg was due solely to the diligence of plaintiffs' counsel. Jaroslawicz additionally avers that the amount plaintiffs' counsel currently seek, as fees, is far less than the amount that counsel would have earned had plaintiffs been billed at an hourly basis, and is a fair and reasonable percentage of the money recovered f o r Rand. In f u r t h e r support of their request, Jaroslawicz has submitted an affidavit containing a summary reconstruction of the hours expended by plaintiffs' counsel with respect to the Warburg defendants. In the remainder of their motion, plaintiffs' counsel request that the settlement funds continue to be h e l d in an interest-bearing escrow account, under the control of either Warburg's or plaintiffs' counsel, pending a final determination in this action. The nominal defendant, Rand, has submitted the only opposition to this motion. 3 [* 5 ] CPLR 4403, the settlement funds will remain in an interestb e a r i n g escrow account held by Willkie Farr & Gallagher, the counsel for defendants Warburg P i n c u s Ventures, L . P . and E.M. Warburg, Pincus & Co.; and it is further ORDERED that a copy of this o r d e r with notice of e n t r y shall be served on the Clerk of the J u d i c i a l Support Office (Room 311) to arrange a date for the reference to the Special Referee. Dated: March 8, 2006 Enter: ' 'J.S.C. 'I 6
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