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Court Confirms Oak And Gobi's Right To Attach $60M Of VisionChina And Vision Best Assets, Wherever Those Assets Are Located, In Connection With VisionChina's Failure To Pay For 2010 Acquisition; Total Damages Could Exceed $90 Million
NEW YORK, June 18, 2012 /PRNewswire/ -- The New York State Supreme Court has confirmed Oak Investment Partners and Gobi Partners' motions to attach
$60 million of VisionChina Media Inc. (Nasdaq: VISN) and Vision Best Limited assets, regardless of where those assets are located. The requests for attachment were filed to secure VisionChina and Vision Best's final payments for a high-profile digital media company that they acquired from the investment funds in 2010.
June 15, 2012 ruling, Justice
Charles E. Ramos also granted Oak and Gobi's motion to undertake discovery in aid of the asset attachment. The Court also significantly limited the arguments that VisionChina can make going forward in defending against Oak and Gobi's breach of contract claims.
Justice Ramos states in his ruling that "It is undisputed that VisionChina failed to remit the Deferred Payments." The Court found that Oak and Gobi "have met [their] initial burden of establishing that VisionChina breached the Merger Agreement" between the parties, but
Justice Ramos declined to grant summary judgment due to "triable issues of fact" with regard to the affirmative defense asserted by VisionChina.
In response to the order,
Mindy Morton, a partner at Bergeson, LLP and counsel for Oak and Gobi stated that, "We are gratified that the Court limited VisionChina's defenses and we now have the ability to attach
$60 million of VisionChina's assets regardless of where they are located."
Oak and Gobi plan to pursue additional damages in connection with VisionChina's breach of its agreements to complete the purchase of Digital Media Group (DMG). Oak and Gobi expect total damages to be at least
VisionChina acquired DMG from the former shareholders of DMG in
January 2010, pursuant to a Merger Agreement that required VisionChina to make an initial payment of
$100 million in cash and stock and two deferred payments of
$30 million each over the next two years. DMG operated
China's leading digital media network inside subway systems consisting of over 34,000 digital screens in 32 subway / high speed train lines and bus shelters.
November 3, 2011, the Court dismissed VisionChina's principal claims and counterclaims for fraud, unjust enrichment, declaratory relief, and breach of contract against Gobi and Oak. The Court's
June 15 decision confirms two
$30 millionex parte orders of attachment that were granted to Oak, Gobi and Shareholder Representative Services, LLC on
November 18 and 29, 2012.
Shareholder Representative Services, LLC, et al. v. VisionChina Media Inc., et al, was filed in the Supreme Court of the
State of New York,
New York County, index # 650526/2011. There is also a related case,
Visionmedia Inc. v. Shareholder Representative, index # 652390/2010.
About Oak Investment Partners
Oak Investment Partners is a multi-stage venture capital firm based in
the United States, with offices in
Palo Alto, California, and
Norwalk, Connecticut. Oak's primary investment focus is on high-growth opportunities in Broadband Internet and Wireless Communications, Information Technology and Software Outsourced Services, Consumer Internet/New Media, Financial Services Technology, Healthcare Information and Services, Clean Energy, and Retail. Over a 33-year history, Oak has achieved a strong track record as a stage-independent investor funding more than 475 companies at key points in their lifecycle.
About Gobi Partners
Founded in 2002, Gobi Partners is a venture capital firm with its headquarters and incubation center in
Shanghai and additional offices in
Hong Kong, and
Tianjin, as well as an overseas office in Singapore. A leading investor in early stage digital media and technology companies in
Greater China, Gobi manages four funds with over
$300 million under management. Since its establishment, Gobi has funded dozens of early to traction stage companies and continues to invest actively in the region.
SOURCE Oak Investment Partners and Gobi Partners