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  • US judge slams Xerox, rejects bid to dismiss $1bn Fujifilm lawsuit

    Posted on WideFormatOnline.com

    "A Manhattan federal judge has turned down Xerox Corp's application to dismiss a $US1 billion lawsuit filed by Fujifilm Holdings after the US company backed out of last year’s proposed $US6.1 billion merger deal. The judge described Xerox’s arguments as “plainly wrong” and “thoroughly unpersuasive.”

    Xerox and Fujifilm agreed to the merger in January 2018 before the Xerox board reversed its decision after legal action by billionaire activist investors Carl Icahn and Darwin Deason, who said the deal undervalued the company.

    In May 2018, Fujifilm sued Xerox for more than $1 billion over the termination of the agreement, accusing the US company of “intentional and egregious conduct.”

    On Friday, a Manhattan federal judge rejected Xerox's request to dismiss the lawsuit, saying one of Xerox's arguments was “thoroughly unpersuasive” and another "flies in the face" of the terms of the agreement.

    “In clearing the way for discovery to proceed, U.S. District Judge John Koeltl said much of the case hinged on disputed facts, such as whether changes to the financial statements of the parties’ joint venture [Fuji Xerox] were material enough for Xerox to justify calling the deal off,” according to an exclusive report by Jack Newsham of US legal news website Law360.

    “But he singled out Xerox’s argument that it was more convenient to litigate at the state courthouse next door as “thoroughly unpersuasive,” especially now that a state appellate court dismissed Fuji from that case and threw out the April 2018 decision that froze the merger.

    “The judge delivered his decision orally after about an hour and a half of argument that opened with Xerox retreating from its argument that the dispute belonged before Justice Barry Ostrager at the state courthouse. ‘Clearly things have changed in the past few months,’ admitted Tariq Mundiya, a lawyer for Xerox." [Read More at WideFormatOnline.com]