NorthPointe Capital Awarded $15.2 Million Following Five-Year Legal Battle with Nationwide Corporation
Michigan-based money manager takes on insurance giant in breach of contract suit
originating from a 2007 purchase agreement
NEW CASTLE COUNTY, Del., July 25, 2014– Troy, Mich.-based NorthPointe Capital, LLC, a boutique investment advisor, has been awarded $15.2 million in damages and termination fees following a five-year legal battle with Columbus, Ohio-based Nationwide Mutual Insurance Co. NorthPointe is represented by the Farmington Hills, Mich.-based complex commercial litigation firm Young & Associates.
The ruling brings to a close a $25 million case that originated from a June 2007 purchase agreement in which insurance giant Nationwide sold their interest in mutual fund manager NorthPointe – along with the right to receive the income generated by the continued management of seven Nationwide mutual funds, including the considerable Nationwide NVIT Mid Cap Growth Fund. The suit alleged that Nationwide breached the contract and misrepresented the transaction, never having intended to uphold its terms.
“Incredibly, Nationwide’s stated reasoning for merging the funds was that NorthPointe had lost a substantial portion of its assets. This was disingenuous at best and completely failed to acknowledge Nationwide’s own role when it raided NorthPointe’s NVIT to fund the Nationwide Multi-Managed NVIT,” Judge Andrea L. Rocanelli of the Superior Court of the State of Delaware, said in her ruling.
Judge Rocanelli’s opinion also outlined the impression left by the testimony of numerous Nationwide executives during the bench trial. “The court finds that high turn-over in key positions at Nationwide resulted in institutional incompetence.”
NorthPointe’s legal representation – Rodger Young and Jaye Quadrozzi of Young & Associates – demonstrated that Nationwide had not only never intended to allow NorthPointe to manage the funds, but had actively planned and carried out the creation of a new multi-manager NVIT mid cap growth fund to compete directly with the NVIT fund NorthPointe was managing.
“We could not be more gratified with Judge Rocanelli’s ruling. Her recognition of Nationwide’s culpability brings to a close what has been a true David and Goliath conflict,” said Young. “Our attorneys have put years of vigorous work into proving allegations of breach of contract, including the breach of the covenant of good faith and fair dealing. When you consider that NorthPointe is a very small, employee-owned firm, and that Nationwide is one of the most massive and recognized corporations in the nation, it brings a certain poignancy to our success.”
Judge Rocanelli found that NorthPointe was entitled to $15,186,381 in damages and termination fees, less a credit of about $4.8 million for what NorthPointe owes under the original 2007 sale agreement. Nationwide has 30 days to appeal the decision.
About Young & Associates
A litigation boutique specializing in complex commercial disputes, Farmington Hills, Michigan-based Young & Associates, P.C. has earned a national reputation for superior representation. With a virtually unbroken string of successful verdicts to the firm’s credit, Young & Associates emphasizes an efficient, lean and aggressive litigation style. The firm represents both local and national clients, and focuses on disputes involving shareholders/partners, contracts, antitrust, patents, trade secrets and manufacturer representatives. Young & Associates has offices in Farmington Hills, Michigan and New York City.