Bankers Trust Must Pay Damages
PHOENIX (AP) _ A jury ordered Bankers Trust New York Corp. to pay millions of dollars in punitive and other damages to three North Carolina investors for making misleading statements about Kroy Inc.
Russell Piccoli, a Phoenix attorney representing the Charlotte investors, put the award at $146.2 million, including $30 million in punitive damages. But attorneys for Bankers Trust put the figure at $84.9 million.
Piccoli said the award included $18.3 million in compensatory damages and $20.4 million in accumulated interest, both of which are subject to triple damages.
The trio _ Stephen Walsh and Warren and Marian Pollock _ contended Bankers Trust’s investment information included erroneous statements of Kroy’s market share, new products and financial projections, and failed to disclose advances made by competitors, Piccoli said.
The suit grew out of the 1986 leveraged buyout of the Scottsdale-based manufacturer once famed for producing hand-operated mechanical lettering devices. Walsh invested $1.2 million, the Pollocks $250,000. Kroy went bankrupt in 1990.
A 1993 trial resulted in an $8.7 million award that was reversed on appeal. Jurors in the current five-week trial in Maricopa County Superior court reached their decision Thursday.
A Bankers Trust spokesman said Friday that the investors had recovered some of their money and predicted that the latest jury award would not stand.
Kroy, a manufacturer of commercial labeling equipment, was bought last fall by Pubco Corp. of Cleveland for $272,500 cash and assumption of a $5 million loan. At the time, it had about 60 employees in Scottsdale and 140 in Wisconsin.