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On May 5, 2020, Justice Andrea Masley of the New York State Supreme Court’s Commercial Division dismissed claims against Cravath client Goldman Sachs, which was sued in January 2019 by its former client, United Natural Foods, Inc. (“UNFI”), the largest publicly traded distributor of natural, organic, specialty conventional grocery and non‑food products in the U.S. and Canada and a major supplier to Whole Foods. In its complaint, UNFI brought claims alleging breach of contract and fraud relating to Goldman’s handling of the syndication of a term loan that UNFI used to finance its $3 billion acquisition of SuperValu Inc., which was announced in July 2018 and closed in October 2018. UNFI sought to recover damages in excess of $230 million, representing recoupment of fees paid and other costs of syndication, as well as incremental interest costs it expects to pay over the life of the loan.
Cravath filed a motion to dismiss the case in May 2019, and argued in July 2019 that the case rested on plaintiff’s faulty assumption that but for alleged wrongdoing, the loan would have easily sold through to the market — which was unlikely at a time when both UNFI and SuperValu reported weak financial results.
To read the rest of the story, please go to: Cravath, Swaine & Moore LLP