ICC Dispute

Damages Related to Capital Structure

In an arbitrated dispute before the International Chamber of Commerce, Claimants alleged that an undisclosed tax liability in connection with an acquisition adversely affected their ablity to issue debt, and sought damages related to the use of a “sub-optimal” capital structure.  Working on behalf of the Respondents, and for the law firm of White and Case, CFP’s Dr. Fenn  analyzed the acquired firm’s debt capacity and the value of issuing additional debt.  Dr. Fenn concluded that damages were, at most, equal to 10% the level claimed by Claimant’s expert.  Following the submission of several rounds of expert reports, Claimants withdrew their expert.