OAKLAND, Calif. (AP) _ Multimillionaire William Millard says he will appeal a verdict ordering him to pay a group of investors $125 million in punitive damages and give them 20 percent of the stock in his ComputerLand empire.
″We intend to appeal the verdict and to pursue every avenue legally available to us until we obtain a just resolution of this matter,″ Millard said in a statement Wednesday after the jury returned its decision.
Millard, one of America’s wealthiest men, lost the first phase of the trial on Monday when a jury ruled he owed 20 percent of the stock in ComputerLand and his other companies to Micro-Vest, a group of about 60 investors who sued Millard in a dispute over a $250,000 loan.
On Wednesday, the same jury awarded $125 million in punitive damages to Micro-Vest. The jury determined ComputerLand is to pay $10 million of the damages, with the remainder paid by Millard and other defendants, including his wife, Patricia, and 11 corporations that include the family’s holding company, IMS Associates Inc.
″We’re confident that the verdicts will be reversed on appeal,″ a statement from ComputerLand said. ″(We’re) especially confident that the punitive damages will be set aside.″
Catherine Graham, an attorney with the firm representing Micro-Vest, said in a telephone interview that the battle was far from over.
Under California law, the judge could change the amount of the award. ″There’s a lot yet ahead,″ Ms. Graham said. ″A lot of legal maneuvering.″
John Martin-Musumeci, one of the founders of Micro-Vest, said he was ″absolutely ecstatic″ when the jury returned Wednesday after four hours of deliberation.
Millard, 52, of Oakland, and his family own 96 percent of the company’s stock. Forbes magazine last year reported that Millard was worth some $600 million.
Some opponents contend the award could force his privately held company to go public. But the company’s statement, delivered by spokesman Glen Udine, said, ″Computerland has no plans to go public.″
Micro-Vest attorney Herbert Hafif, who will get 10 percent of whatever he recovers for the company, said that ″a $100 million punitive judgment is guaranteed to make him go public,″ adding that Millard would need the money from sale of the stock to pay the judgment.
Micro-Vest sued in 1981 after paying about $400,000 for the $250,000 note. The note was issued in 1976 after Millard borrowed money from Massachusetts- based Marriner & Co., Inc., to help fund his fledgling IMS Associates Inc. He founded Computer Shack that same year, and it later grew into ComputerLand, a chain of computer stores.
The dispute centered on a section of the note that gave Marriner the option of converting it into 20 percent of the stock in Millard’s companies. The suit was filed after Millard refused to convert the note into stock for Micro-Vest.
Millard didn’t dispute terms of the note, but contended he had an oral agreement with Marriner President Loring Reed that the note would not be sold without Millard’s approval.
ComputerLand has 791 franchised computer retail stores, which had revenues of $1.4 billion in 1984. However, ComputerLand’s chief financial officer testified Tuesday that the company’s net worth was about $25 million.