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Helping an Asset Litigation Company Recover Profits from a Multinational Corporation While Avoiding Litigation and Regulatory Violations

Attorneys Involved: Neal A. Jacobs

Our client, an asset disposal company, had bid successfully for what promised to be a lucrative contract disposing of surplus assets for the worldwide operations of a multinational corporation. The job would require the disposal company’s team to travel across the world to survey, inventory, appraise and liquidate equipment and other property.

Unfortunately, soon after our client began the work, they discovered that there were far fewer assets to be disposed of than the contract and the corporation’s records had indicated. $20 million in anticipated profits never materialized -- our client could not even recover its costs for the project. The corporation had ignored the company’s numerous requests to be compensated for its efforts. At the time they contacted Jacobs Law Group’s commercial litigation attorneys, our client had run out of patience and believed they needed to sue the corporation to recoup their losses.

Litigation is expensive, and litigation against an opponent with the resources of a typical large corporation is often prohibitive. Jacobs Law Group’s corporate attorneys advised a more measured approach. Our team recognized right away that our client’s lost investment also amounted to a legal issue for the corporation. The same accounting inaccuracies that caused our client to lose money on the contract had the potential to cost the corporation an enormous sum of money in fines for regulatory violations.

Rather than take an adversarial stance, Jacobs Law Group saw an opportunity to arrive at a solution that would benefit both our client and the multinational corporation. Our team formulated a plan to document, country by country, the discrepancies between the assets on the ground and the surplus equipment lists. Jacobs Law Group then used its professional network to obtain an introduction to a board member of the corporation. That board member also sat on the corporation’s audit committee.

After speaking with Jacobs Law Group, the board member convened a conversation between our attorneys, the corporation’s general counsel, and our client. All participants quickly appreciated the serious nature of the issue. The corporation recognized the value of taking steps to quietly determine the extent and nature of its accounting deficiencies, allowing them to correct their books to reflect properly the value of their surplus assets.

The Jacobs Law Group’s solution was a genuine “win-win.” It enabled our client to recover a significant portion of its lost profits, prompted the multinational corporation to take corrective action on the accounting front, and was completed in a small fraction of the time that a lawsuit would have taken.

Press Releases

Jacobs Law Group Expands with Two Commercial Litigation Attorneys

Philadelphia business law firm Jacobs Law Group is pleased to announce that Richard “Dick” McElroy and Jeffrey C. McElroy, have joined the firm. With more than 60 years combined experienced, the father and son team have been highly successful at receiving results for leading businesses in litigation. Read More.

Events

Leading PA Business Divorce Attorney Neal A. Jacobs to Act as Faculty for PBI CLE ‘Business Divorce: Startup to Litigation to Resolution’

Jacobs Law Group Founder and Managing Attorney Neal A. Jacobs is acting as course planner and will present as part of a CLE on business divorce for the Pennsylvania Bar Institute. The program, “Business Divorce: Startup to Litigation to Resolution” will be held on Nov. 6 in Mechanicsburg, Nov. 8 in Philadelphia, and Nov. 13 in Pittsburgh. Read more...

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