Icahn Continues Battle With Wachtell After Bank Settlements
Three years after Carl Icahn's successful hostile takeover of CVR Energy, the billionaire investor has settled litigation with CVR's investment banks. But he isn't ready to make peace with Wachtell, Lipton, Rosen & Katz.
November 02, 2015 at 10:17 AM
4 minute read
More than three years after Carl Icahn gained control of CVR Energy Inc. in a hostile takeover battle, the billionaire investor has settled his fee dispute with the two investment banks that helped craft CVR's unsuccessful defense. But Icahn still isn't done fighting with CVR's former lawyers at Wachtell, Lipton, Rosen & Katz.
Icahn's takeover of CVR in 2012 sparked a litigation war on three fronts. First, CVR's investment banks—Goldman Sachs & Co. and Deutsche Bank Securities Inc.—sued CVR in New York state court because the company refused to pay a $36 million fee that the banks claimed they were owed for the takeover defense. Then CVR sued Wachtell for malpractice in Manhattan federal court in October 2013, accusing the firm and two of its partners of failing to explain to CVR directors the terms of the company's fee agreement with Goldman and Deutsche Bank. The company is seeking $36 million for the bank fee and $6 million for Wachtell's fee. Two months later, Wachtell sued CVR and Icahn in state court, seeking a declaration that it didn't commit malpractice.
In a quarterly report filed on Friday with the U.S. Securities and Exchange Commission, CVR revealed that it settled with the two banks last month. The company didn't reveal the exact settlement terms, but it indicated that CVR ended up paying the banks less than the full $36 million fee. As a result of the settlement, CVR dropped its appeal of a state court ruling in favor of the banks on the fee issue.
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