Matthew H. Leighton

Simpson Thacher advised New Mountain Capital in the formation and raising of New Mountain Net Lease Partners II, L.P. (“NMNLP II”). NMNLP II closed at $825 million in capital commitments, including the capital commitment from New Mountain and its professionals, substantially exceeding its initial fundraising goal of $750 million.~~New Mountain Capital is a New York-based alternative investment firm that emphasizes business building and growth. The firm currently manages private equity, credit and net lease real estate funds with over $40 billion in assets under management as of March 31, 2023.~~The Simpson Thacher team advising on NMNLP II included David Greene, Matthew Leighton, Lawton Salley and Thomas Boland (Funds); Andrew Purcell, Adam Hersch and Shareef Salfity (Tax); and Jeanne Annarumma (Executive Compensation and Employee Benefits).

Jun 28

1 min

A bidder in the sale of Citgo's parent company to satisfy billions of dollars of Venezuelan debt has asked to disqualify a Delaware federal judge from the forced judicial auction, saying it submitted the top bid of $7.9 billion but unfairly lost out to a competitor's lower bid. Mining company Gold Reserve Ltd. argued in its Friday motion to disqualify U.S. Circuit Judge Leonard P. Stark that new discovery has revealed material conflicts of interest related to special master Robert B. Pincus and the special master's advisers at law firm Weil Gotshal & Manges LLP and investment banking firm Evercore Inc. While there is no evidence that Judge Stark has any actual bias against Gold Reserve, the district judge had consulted with the advisers, who themselves have conflicts of interest, and so the conflicts must be attributed to Judge Stark, Gold Reserve said. The mining company also seeks an order disqualifying Pincus, Weil Gotshal and Evercore, along with a temporary stay of all decisions involving any bids submitted in the Citgo sale process. Gold Reserve alleges that the special master, who is tasked with overseeing a fair sale process for shares of Citgo's indirect parent company, PDV Holding Inc., has been assisted throughout the process by conflicted advisers from Weil and Evercore. PDV Holding is a U.S. subsidiary of the Venezuelan state-owned Petróleos de Venezuela SA,  and the indirect parent company of the oil giant Citgo. The court is conducting a long-awaited sale about seven years after defunct Canadian mining company Crystallex International Corp. won an attachment order over the PDV Holding shares to satisfy a $1.2 billion arbitral award it won after being ousted from a Venezuelan gold-mining project. Pincus recommended Elliott Investment Management LP's bid, which was $2 billion lower than Gold Reserve's bid, while blocking other bidders from access and repeatedly favoring Elliott, according to the disqualification motion. "The special master has been assisted throughout [the sale] process by conflicted advisers from Weil and Evercore," the motion said. "And not just assisted. Throughout this proceeding, these advisers have dominated communications with the parties — and, as the court is aware, with the court — while the special master often offers little input himself. Under their influence, the special master has made a series of decisions over the past 14 months that have favored Elliott Investment Management, a major client of both his advisers, and that other participants and observers have found inexplicable." Not only do Weil and Evercore have longstanding financial ties with Elliott and bondholders through which they have collected undisclosed fees, but they have steered the sale process in their favor, according to the motion. The advisers have failed to disclose these conflicts and have misrepresented them to the parties and the court, minimizing them as "not material," the motion claimed. A lawyer for Gold Reserve, Michael J. Bowe of Brithem LLP, told Law360 in an email Tuesday that the motion is a serious application that Gold Reserve did not undertake lightly. "Although Weil redacted the magnitude of its conflict from public view, this cannot be sustained," Bowe wrote. "When the facts become known, the necessity of this motion will be clear." Counsel for Crystallex declined to comment Tuesday. Counsel for the other parties did not immediately respond to requests for comment. On July 24, Venezuela called on Judge Stark to reject a Gold Reserve subsidiary's $7.4 billion bid to buy Citgo, arguing that the purchase price was well below half of the shares' fair market value of $18.6 billion. Gold Reserve later raised the bid price to $7.9 billion. Pincus previously recommended on July 2 that Judge Stark approve the bid submitted by the Gold Reserve subsidiary, acquisition vehicle Dalinar Energy Corp, for all PDV Holding Inc. shares, saying it was the highest among those that met the court's bid requirements. Pincus told the judge that the bid for the PDV Holding Inc. shares was significantly higher than a $3.806 billion revised stalking-horse bid submitted by an affiliate of Contrarian Capital Management earlier this year. "Thus, the special master concludes that Dalinar's proposed sale transaction is the highest bid that he reasonably believes to be capable of being timely consummated after taking into account the factors in the court's guidance," Pincus wrote. Gold Reserve is represented by Kevin J. Mangan, Matthew P. Ward and Stephanie S. Riley of Womble Bond Dickinson (US) LLP, by Matthew H. Kirtland, Katherine G. Connolly and Taylor J. LeMay of Norton Rose Fulbright US LLP, and by Michael J. Bowe of Brithem LLP. Pincus is represented by Myron T. Steele, Matthew F. Davis and Bindu A. Palapura of Potter Anderson & Corroon LLP, and by Matthew S. Barr, David J. Lender, Jared R. Friedmann and Chase A. Bentley of Weil Gotshal & Manges LLP. Venezuela is represented by A. Thompson Bayliss and Christopher Fitzpatrick Cannataro of Abrams & Bayliss LLP and by Donald B. Verrilli Jr., Elaine J. Goldenberg, Ginger D. Anders, George M. Garvey and Adeel Mohammadi of Munger Tolles & Olson LLP. PDV Holding and Citgo are represented by Susan W. Waesco and Alexandra M. Cumings of Morris Nichols Arsht & Tunnell LLP and by Nathan P. Eimer, Lisa S. Meyer, Daniel D. Birk, Gregory M. Schweizer and Hannah Bucher of Eimer Stahl LLP. Petróleos de Venezuela SA is represented by Samuel T. Hirzel II and Brendan P. McDonnell of Heyman Enerio Gattuso & Hirzel LLP and by Joseph D. Pizzurro, Kevin A. Meehan and Juan O. Perla of Curtis Mallet-Prevost Colt & Mosle LLP. Crystallex is represented by Raymond J. DiCamillo, Jeffrey L. Moyer and Travis S. Hunter of Richards Layton & Finger PA, and by Robert L. Weigel, Jason W. Myatt, Rahim Moloo, Miguel A. Estrada, Lucas C. Townsend, Zachary Kady and Adam M. Smith of Gibson Dunn & Crutcher LLP. The bondholders are represented by Daniel A. Mason, Jeffrey J. Recher, Paul A. Paterson and Tyler B. Myers of Paul Weiss Rifkind Wharton & Garrison LLP. The case is Crystallex International Corp. v. Bolivarian Republic of Venezuela, case number 1:17-mc-00151, in the U.S. District Court for the District of Delaware.

Oct 14

5 min

A federal judge on Thursday denied efforts to unseat him and the court-appointed special master overseeing the sale of Citgo's parent company to satisfy billions of dollars in Venezuelan debt, ruling that the motions are both procedurally defective and unmeritorious. Ruling in a 54-page opinion, U.S. Circuit Judge Leonard P. Stark concluded that the motions were untimely and based on waived arguments. Moreover, his impartiality in the case, as well as that of special master Robert Pincus and his advisers at Weil Gotshal & Manges LLP and Evercore Inc., could not be reasonably questioned, according to the opinion. In a long-running dispute, creditors against Venezuela are seeking in Delaware federal court to attach shares in the parent of the energy company Citgo, which is indirectly owned by Venezuela's state-owned oil company. (Photo by Jakub Porzycki/NurPhoto via AP) Judge Stark, formerly a district court judge for the District of Delaware, was elevated to the Federal Circuit in 2022, but he continues to oversee a variety of cases brought by creditors against Venezuela in Delaware federal court. The parties that filed the motions are Gold Reserve Ltd.; Venezuela; state-owned oil company Petróleos de Venezuela SA, or PDVSA; and Citgo, whose parent company, Citgo Holding Inc., is indirectly owned by PDVSA through subsidiary PDV Holding Inc. Shares in PDV Holding are being auctioned off in the proceeding. They argued that Pincus and his advisers were conflicted due to their role advising hedge fund Elliott Investment Management, the company whose bid to purchase shares in PDV Holding won a nod from Pincus in his updated final recommendation for a bidder. The moving parties also pointed to tens of millions of dollars in fees paid to Weil Gotshal for its representation of bondholders owed nearly $3 billion by Venezuela, referred to as to 2020 bondholders for the year their bonds matured. The 2020 bondholders have a 50.1% interest in Citgo Holding. But Judge Stark was unconvinced, saying the public nature of the sales process had reduced "opportunities for mischief" and that the moving parties' attempts to portray favoritism toward Elliott were "selective and unconvincing." Gold Reserve had additionally challenged Pincus and Judge Stark on the basis of actual bias, but this, too, was rejected by the judge. In his conclusion, the judge noted that it was necessary in the long-running case to appoint a special master to accomplish the "daunting task" of attaching shares in PDV Holding and auctioning them off to satisfy more than $22 billion in Venezuelan debt. That special master would need qualified legal and financial advisers, and eliminating from the bidding any interested entity that had been represented by these advisers "would undermine, if not entirely defeat, the court's goal, and legal obligation, to conduct the sale in [a] manner maximizing value," he wrote. Judge Stark noted that these advisers would "inevitably have precisely the types of entanglements" with potential bidders that the moving parties argued should be disqualifying. "The court recognizes that failure is precisely what the Venezuela parties have always desired, as they candidly admit," he wrote. "Failure is also the result Gold Reserve currently prefers, as it plainly fears that if it cannot prevent the court from reaching the merits then the court is going to approve the bid the special master recommended instead of its own." "While, as noted earlier, the court is not making any finding as to the motivations of the movants, neither is it blind to the facts it has noted," according to the opinion. The Delaware court is conducting the long-awaited sale seven years after defunct Canadian mining company Crystallex International Corp. won an attachment order over the PDV Holding shares to satisfy a $1.2 billion arbitral award it won after being ousted from a lucrative Venezuelan gold mining project. In the years since then, the process has attracted other creditors of Venezuela owed billions of dollars more, since Citgo is Venezuela's most significant seizable asset. Those creditors include Gold Reserve, which won its $713 million arbitral award in September 2014 after Venezuela yanked its permit for a gold mining project. Gold Reserve initially won the nod from Pincus as his chosen bidder in a final recommendation earlier this year, with a $7.382 billion bid. But the special master later changed his mind, issuing an updated final recommendation that the court approve a $5.892 billion bid from Elliott. The latter bid included additional cash consideration to discharge $500 million of attached judgments as well as an agreement with a majority of the 2020 bondholders. Gold Reserve is represented by Kevin J. Mangan, Matthew P. Ward and Stephanie S. Riley of Womble Bond Dickinson (US) LLP, Matthew H. Kirtland, Katherine G. Connolly and Taylor J. LeMay of Norton Rose Fulbright US LLP, and by Michael J. Bowe, Lauren Tabaksblat, Andrew T. Sutton and Kate E. Fisch of Brithem LLP. Pincus is represented by Myron T. Steele, Matthew F. Davis, Bindu A. Palapura and Malisa C. Dang of Potter Anderson & Corroon LLP, and by Matthew S. Barr, David J. Lender, Jared R. Friedmann and Chase A. Bentley of Weil Gotshal & Manges LLP. Venezuela and PDVSA are represented by Samuel Taylor Hirzel II and Brendan Patrick McDonnell of Heyman Enerio Gattuso & Hirzel LLP, Donald B. Verrilli Jr., Elaine J. Goldenberg, Ginger D. Anders, George M. Garvey and Adeel Mohammadi of Munger Tolles & Olson LLP, and Joseph D. Pizzurro, Kevin A. Meehan and Juan O. Perla of Curtis Mallet-Prevost Colt & Mosle LLP. PDV Holding and Citgo are represented by Susan W. Waesco, Alexandra M. Cumings and Phillip Reytan of Morris Nichols Arsht & Tunnell LLP and by Nathan P. Eimer, Lisa S. Meyer, Daniel D. Birk, Gregory M. Schweizer and Hannah Bucher and Alec Solotorovsky of Eimer Stahl LLP. Crystallex is represented by Raymond J. DiCamillo, Jeffrey L. Moyer and Travis S. Hunter of Richards Layton & Finger PA, and by Robert L. Weigel, Jason W. Myatt, Rahim Moloo, Miguel A. Estrada, Lucas C. Townsend, Zachary Kady and Adam M. Smith of Gibson Dunn & Crutcher LLP. The case is Crystallex International Corp. v. Bolivarian Republic of Venezuela, case number 1:17-mc-00151, in the U.S. District Court for the District of Delaware.

Nov 13

5 min

A Philadelphia jury found a skills game designer and manufacturer partially liable this week for the fatal shooting of a gas station clerk who made large cash payouts to people placing bets on unregulated skills game machines. On Monday, a jury for the Philadelphia County Court of Common Pleas rendered a $15.3 million verdict in favor of the estate of Ashokkumar Patel, who had worked as a store clerk at a gas station and convenience store in Hazelton, Pennsylvania, where he was shot and killed by an alleged skill games player. Pace-O-Matic (POM), which designs skills games, and Miele Manufacturing, which manufactures and distributes the games, were found negligent for lax safety protocols that led to Patel's death. Patel's estate claimed there was a lack of safety measures for the unregulated skills gaming machines at the store, such as count rooms, drop safes, cashier cages, partner-shift work, and surveillance. The trial started on Nov. 3 and lasted one week. The jury began deliberating on Monday, returning a verdict the same day, said John Lang of Saltz Mongeluzzi Bendesky, one of the attorneys who represented plaintiff Edward M. Biggin as the administrator of Patel's estate. The jury awarded the estate $10 million for the loss of guidance, teaching, advice, care, comfort, and moral upbringing, $5 million for Patel's pain and suffering, and $300,000 for loss of support. POM was assigned 14% fault and Miele was found to be 6% at fault. Robert W. Zimmerman, also of Saltz Mongeluzzi Bendesky, said the estate intends to collect $11.4 million from POM and Miele under the doctrine of joint liability, while claiming the remainder of the verdict is assigned to the owner of the property, who settled prior to trial. The shooter, who was convicted of fatally shooting Patel, was assigned 55% fault. "The facts came out," Zimmerman said about the verdict. "We hope that POM sees what happened here and takes action." The incident took place Dec. 12, 2020, at a time when all legal casinos were closed due to the COVID-19 pandemic. According to the estate, Patel was responsible for a "mini-casino," paying out winners of the unregulated "skill games" by handing them cash from an unlocked bag beneath the store counter while the winner stood and watched. Patel was responsible for making large cash payouts to people placing bets on the game machines without security measures in place to protect him from foreseeable risks, the estate claimed. The stash of money contained around $7,000, and the shooter, who was known to have previously lost money on the gambling machines, robbed the store. Patel was fatally shot during the robbery, the complaint said. POM and Miele both argued in their respective pretrial memos that it was unclear how many games were at the location, including how many of the games were actually POM/Miele games, alleging that the estate failed to produce any evidence that the games the shooter allegedly came in and often played their games. The defendants argued that they didn't owe a statutory duty to the plaintiff and that there was no causal connection between their alleged conduct and the robbery and murder. "As part of its business model, POM does not assemble any hardware or any gaming terminals. Rather, POM sells the software contained in the POM game. One entity that POM sells its software to is Miele Manufacturing, Inc. Similar to Miele, the POM defendants do not place POM games in locations, and, as such, any security plans are not something that are within the purview of the POM Defendants," POM alleged in its pretrial memo. Zimmerman said that a key part of their trial strategy was showing that the defendants were in control of their games and declined to follow standard safety principles. According to Zimmerman, they stressed to the jury that this was POM's enterprise, using visuals like a chart graphic showing POM at the head of its skills games operation. Zimmerman said the team also relied on expert witnesses, including Derk Boss, a security consultant who specializes in gaming security and surveillance who testified on safety rules within the state, and forensic pathologist Dr. Wayne Ross, who took the jury through the last 30 minutes of Patel's life after he was shot multiple times. The estate also showed the jury the footage of Patel attempting to crawl through the store to call for help, and him struggling to speak after being shot in the jaw, Zimmerman said. Matthew H. Haverstick of Kleinbard, in Philadelphia, represented the POM defendants and noted that they plan to appeal. "I think the danger of a verdict like this to business in Pennsylvania is potential liability to products in stores having nothing to do with the commission of a crime," Haverstick said. Marc F. Lovecchio of McCormick Law Firm, in Williamsport, represented Miele Manufacturing and referred comment to POM. Monday's verdict follows a $3.8 million settlement that was reached in August between the estate and Sunoco defendants, Palisades Fuel, G&G Oil Company, Kevin Smith Amusements, Banilla Games, and Primero Games.

Nov 11

4 min

A federal judge on Thursday denied efforts to unseat him and the court-appointed special master overseeing the sale of Citgo's parent company to satisfy billions of dollars in Venezuelan debt, ruling that the motions are both procedurally defective and unmeritorious. Ruling in a 54-page opinion, U.S. Circuit Judge Leonard P. Stark concluded that the motions were untimely and based on waived arguments. Moreover, his impartiality in the case, as well as that of special master Robert Pincus and his advisers at Weil Gotshal & Manges LLP and Evercore Inc., could not be reasonably questioned, according to the opinion. In a long-running dispute, creditors against Venezuela are seeking in Delaware federal court to attach shares in the parent of the energy company Citgo, which is indirectly owned by Venezuela's state-owned oil company. (Photo by Jakub Porzycki/NurPhoto via AP) Judge Stark, formerly a district court judge for the District of Delaware, was elevated to the Federal Circuit in 2022, but he continues to oversee a variety of cases brought by creditors against Venezuela in Delaware federal court. The parties that filed the motions are Gold Reserve Ltd.; Venezuela; state-owned oil company Petróleos de Venezuela SA, or PDVSA; and Citgo, whose parent company, Citgo Holding Inc., is indirectly owned by PDVSA through subsidiary PDV Holding Inc. Shares in PDV Holding are being auctioned off in the proceeding. They argued that Pincus and his advisers were conflicted due to their role advising hedge fund Elliott Investment Management, the company whose bid to purchase shares in PDV Holding won a nod from Pincus in his updated final recommendation for a bidder. The moving parties also pointed to tens of millions of dollars in fees paid to Weil Gotshal for its representation of bondholders owed nearly $3 billion by Venezuela, referred to as to 2020 bondholders for the year their bonds matured. The 2020 bondholders have a 50.1% interest in Citgo Holding. But Judge Stark was unconvinced, saying the public nature of the sales process had reduced "opportunities for mischief" and that the moving parties' attempts to portray favoritism toward Elliott were "selective and unconvincing." Gold Reserve had additionally challenged Pincus and Judge Stark on the basis of actual bias, but this, too, was rejected by the judge. In his conclusion, the judge noted that it was necessary in the long-running case to appoint a special master to accomplish the "daunting task" of attaching shares in PDV Holding and auctioning them off to satisfy more than $22 billion in Venezuelan debt. That special master would need qualified legal and financial advisers, and eliminating from the bidding any interested entity that had been represented by these advisers "would undermine, if not entirely defeat, the court's goal, and legal obligation, to conduct the sale in [a] manner maximizing value," he wrote. Judge Stark noted that these advisers would "inevitably have precisely the types of entanglements" with potential bidders that the moving parties argued should be disqualifying. "The court recognizes that failure is precisely what the Venezuela parties have always desired, as they candidly admit," he wrote. "Failure is also the result Gold Reserve currently prefers, as it plainly fears that if it cannot prevent the court from reaching the merits then the court is going to approve the bid the special master recommended instead of its own." "While, as noted earlier, the court is not making any finding as to the motivations of the movants, neither is it blind to the facts it has noted," according to the opinion. The Delaware court is conducting the long-awaited sale seven years after defunct Canadian mining company Crystallex International Corp. won an attachment order over the PDV Holding shares to satisfy a $1.2 billion arbitral award it won after being ousted from a lucrative Venezuelan gold mining project. In the years since then, the process has attracted other creditors of Venezuela owed billions of dollars more, since Citgo is Venezuela's most significant seizable asset. Those creditors include Gold Reserve, which won its $713 million arbitral award in September 2014 after Venezuela yanked its permit for a gold mining project. Gold Reserve initially won the nod from Pincus as his chosen bidder in a final recommendation earlier this year, with a $7.382 billion bid. But the special master later changed his mind, issuing an updated final recommendation that the court approve a $5.892 billion bid from Elliott. The latter bid included additional cash consideration to discharge $500 million of attached judgments as well as an agreement with a majority of the 2020 bondholders. Gold Reserve is represented by Kevin J. Mangan, Matthew P. Ward and Stephanie S. Riley of Womble Bond Dickinson (US) LLP, Matthew H. Kirtland, Katherine G. Connolly and Taylor J. LeMay of Norton Rose Fulbright US LLP, and by Michael J. Bowe, Lauren Tabaksblat, Andrew T. Sutton and Kate E. Fisch of Brithem LLP. Pincus is represented by Myron T. Steele, Matthew F. Davis, Bindu A. Palapura and Malisa C. Dang of Potter Anderson & Corroon LLP, and by Matthew S. Barr, David J. Lender, Jared R. Friedmann and Chase A. Bentley of Weil Gotshal & Manges LLP. Venezuela and PDVSA are represented by Samuel Taylor Hirzel II and Brendan Patrick McDonnell of Heyman Enerio Gattuso & Hirzel LLP, Donald B. Verrilli Jr., Elaine J. Goldenberg, Ginger D. Anders, George M. Garvey and Adeel Mohammadi of Munger Tolles & Olson LLP, and Joseph D. Pizzurro, Kevin A. Meehan and Juan O. Perla of Curtis Mallet-Prevost Colt & Mosle LLP. PDV Holding and Citgo are represented by Susan W. Waesco, Alexandra M. Cumings and Phillip Reytan of Morris Nichols Arsht & Tunnell LLP and by Nathan P. Eimer, Lisa S. Meyer, Daniel D. Birk, Gregory M. Schweizer and Hannah Bucher and Alec Solotorovsky of Eimer Stahl LLP. Crystallex is represented by Raymond J. DiCamillo, Jeffrey L. Moyer and Travis S. Hunter of Richards Layton & Finger PA, and by Robert L. Weigel, Jason W. Myatt, Rahim Moloo, Miguel A. Estrada, Lucas C. Townsend, Zachary Kady and Adam M. Smith of Gibson Dunn & Crutcher LLP. The case is Crystallex International Corp. v. Bolivarian Republic of Venezuela, case number 1:17-mc-00151, in the U.S. District Court for the District of Delaware.

Nov 13

5 min