On January 23, 2017, an order was delivered in a case captioned as IIP Cleveland Regeneration, LLC, et al. v. Zhenfen Huang, et. al., Case No 1:16 CV 2673, pending in the U.S. District Court for Northern District of Ohio. Our firm represented the defendants in this case. After vigorous defending, the District Court dismissed plaintiffs’ complaint. This results a total and complete victory for our clients.
This case had not lasted long. After plaintiffs filed their complaint, we immediately responded with a motion to dismiss. This was because the complaint was poorly written, without any factual substance and legal basis. Plaintiffs then amended their complaint, significantly altered the initial landscape of the complaint, even added additional defendant in an effort to boost their case. We quickly filed a second motion to dismiss. In the end, legal fiction, no matter how voluminous it seemed, could not save plaintiffs’ ill-conceived complaint. The district court agreed with us and dismissed this case.
Whether prosecuting or defending, we handle your case with uttermost care and best effort. If you or your company need a competent law firm to handle disputes or litigation, please contact us.
Overall trend. The mergers and acquisitions Lei Jiang LLC handled in 2016 are mostly global in nature, involving Asia Pacific companies as buyers and American companies as sellers. The dominant buyers are again Chinese companies. But we see different Chinese buyers, including Chinese private equity firms, publically listed companies, and even private owned companies. The traditional outbound M&A was dominated by Chinese state-owned enterprises. The new trend signaled a broader bases, bigger appetite, and increased capacity for Chinese companies to acquire U.S. companies.
Although this new array of buyers has very short track record of cross-regional M&A, they have showed some experience and are comfortable in the deal. From our dealing with these customers, we have discerned factors behind this buying spree. They are 1) to boost the growth rate of the company, 2) lack of domestic targets for acquisitions, and 3) ease of the restrictions on finance.
Implications for U.S. companies. U.S. companies should consider Chinese companies as legitimate partners and buyers if they want to fully utilize the value. First, Chinese companies normally pay higher premium in acquiring U.S. companies. They take into consideration of the long term development and potentials. Second, consistent with Chinese culture, Chinese buyers place high value on the relationship with the management before, during and after the transaction. Moreover, in the M&A we handled in 2016, all Chinese buyers have retained the management team and given generous compensations to the U.S. teams. Finally, according to Forbes, by the end of August 2016, China was so far the top acquirer of foreign companies. If the trend continued to the end of year, China would unseat the USA for the first time since 2006. Thus, U.S. companies simply cannot afford to ignore this group of acquirers.
Implications for Chinese/Asia Pacific companies. As mentioned, Chinese companies typically adopt a longer-time investment evaluation, causing them to pay a relatively higher premium. Moreover, paying premium to retain the target’s management team shows that Chinese companies are not familiar with the dynamics of the overseas market and are not capable of running the target initially. Still, cross-regional M&A can be a value enhancing strategy for Chinese companies. If it fits their long-term strategies, in the long run these companies will gain a competitive advantage in the global market.
Lei Jiang Law Firm has successfully concluded several M&A deals in 2016. Some are still in the process. We are proud to provide top-notch M&A services to our clients. Our team are skilled in cross-regional M&A. We understand the cultural difference, language nuance, and different regulatory requirements. We are here to make it happen.
One more successful trial was conducted by attorneys in Lei Jiang Law Firm. Attorney Jiang was the lead counsel. He, et al. v. Rom, et al., Case No. 1:15-CV-01869, was initially filed as a class action in the U.S. District Court for Northern District of Ohio. Three Plaintiffs represented a class of 140 people against eight individual and corporate defendants. Class action, international parties, service issues, taking evidence under Hague Convention, and electronic discovery all render this case one of the most complex cases. But we see it as an opportunity to establish ourselves in the global litigation and advanced dispute resolution arena.
Electronic discovery presented a unique challenge in this case. Our firm represented Plaintiffs and were dumped with 86 gigabyte (GB) of electronic stored information (ESI) after a successful motion to compel filed by us. The dumping was just one month before the discovery cut off deadline. Considering that 1GB typically contains 64,782 pages of documents (more pages for email files). 86 GB contains an enormous amount of documents for review. Yet, we swiftly employed a comprehensive strategy, utilized latest software and platform, and conducted document review in the most effective and efficient manner. Our team, attorneys and computer forensic expert, worked diligently on the data. As a result, the relevant information was quickly extracted for litigation. We were able to review a large amount of information within a relatively short period of time.
Although Plaintiffs’ effort in class certification failed, the final result was a success. The case proceeded to the trial. Four day trial resulted a complete victory for our clients. Plaintiffs prevailed on all claims submitted to the jury, including fraud and violation of Ohio Deceptive Trade Practice Action. Plaintiffs also successfully pierced corporate veils of all remaining corporate defendants – make their owner personally liable for the corporate misconduct. Finally, Plaintiffs were awarded with punitive damage and attorney fee. This is a stunning victory for Plaintiffs, considering fraud, piercing the corporate veil, and seeking punitive damage were the most difficult tasks in any lawsuit.
In this case, we also utilized new technology for virtual remote deposition and contemporaneous transmission of trial testimony from the other side of the globe – Hong Kong. The new technology we used was tested first time in the Northern District of Ohio. It significantly reduced the cost, and eased restrictions on time, place, facility and equipment. In this case, legal expertise and technologies were worked together seamlessly.
It must be mentioned that Plaintiffs were lucky to have the case be heard in the court of honorable Judge James Gwin. Judge Gwin took no shortcuts, made no detours, and in this case, he made the full journey necessary to accomplish justice.
If you or your company need a competent law firm to handle international disputes or litigation, please contact us.
On August 23, 2015, Ms. Zheng and several others, as representatives of a class, filed a class action at U.S. District Court Northern District of Ohio against the biggest online real estate investment portal in China SouFun Holding Ltd. and SouFun International Ltd.
The complaint alleged fraud, violation of Ohio Deceptive Trade Practice Act, violation of Ohio Consumer Sales Practice Law, violation of Ohio real estate law, unjust enrichment, and breach of fiduciary duty. Lei Jiang Law Firm represents Plaintiffs and the class.
Since this is a case involving international parties, the service was a challenge because it must go through Hague Convention service of process. Plaintiffs successfully perfected the service through Hague Convention.
Major Chinese media in China and U.S. have reported this case. The case is closely watched by many due to the ever increasing trend of Chinese investing in U.S. and global real estate.
For report from the People’s Daily, the official media, click here.
Reports from the biggest Chinese media (in Chinese) QQ, Sina, SOHU, NETEASE.
Reports from the biggest U.S. Chinese media (in Chinese) USChinaPress， 中金在线.