Fortress Value Recovery Fund I LLP & Ors v Blue Skye Special Opportunities Fund LP (A Firm) & Ors [2012] EWHC 1486 (Comm) (30 May 2012)

Fortress Value Recovery Fund I LLP & Ors v Blue Skye Special Opportunities Fund LP (A Firm) & Ors [2012] EWHC 1486 (Comm) (30 May 2012)

The court refused further disclosure as sought, finding it disproportionate and unnecessary to police the injunction. The application for increased fortification was refused due to lack of specific evidence of risk of loss. Security for costs was ordered against the claimants, as their assets were illiquid and there was reason to believe they could not meet costs liabilities. A stay was granted under s.9 Arbitration Act 1996 for claims within the scope of the arbitration clause. Permission to re-re-amend the claim form was not opposed and granted.

Citation
[2012] EWHC 1486 (Comm)
Parties
Claimant: Fortress Value Recovery Fund I LLC; Claimant: ZBS Capital Partners L.P.; Claimant: Cypress Way European Asset Investors II SARL; Defendant: Blue Skye Special Opportunities Fund L.P.; Defendant: Mr Salvatore Cerchione; Defendant: Mr Gianluca D'Avanzo; Defendant: Stepstone Acquisition Sàrl; Defendant: Blue Skye GP Ltd; Defendant: DBZ Special Investment (Lux) Sàrl; Defendant: Benlomond Corporation Sàrl; Defendant: Blue Skye Management Sàrl; Defendant: Blue Skye Capital Sàrl; Defendant: Blue Skye Management Sàrl SCS; Defendant: Greentea S.A.; Defendant: Blue Skye Financial Holdings Sàrl; Defendant: Omega Skye Partners Limited Partnership; Defendant: Omega Partners Sàrl; Defendant: Mr Mattia Mirko Danese; Defendant: Mr Francesco Paolo Padula; Defendant: Mr Giovanni Caslini; Defendant: BSKYE Investors Sàrl
Jurisdiction
England and Wales
Judgment Date
30 May 2012
Procedural Posture
Commercial Court Proceedings (injunction and Related Applications) / Interlocutory Applications Following Grant of Injunction
Outcome
Applications determined as follows: further disclosure refused; increased fortification refused; security for costs ordered; stay granted for arbitration claims; permission to re-re-amend claim form granted.
Legal Topics
Freezing Injunctions, Disclosure Obligations, Security for Costs, Arbitration Stay, Cross Undertaking in Damages, Reflective Loss, Jurisdiction, Management Fees and Asset Valuation, Contractual Information Rights
Commercial Law Insolvency Law Equity and Trusts Civil Procedure Freezing Injunctions Disclosure Obligations Security for Costs Arbitration Stay +5 more

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Parties

Fortress Value Recovery Fund I LLC

Claimant

ZBS Capital Partners L.P.

Claimant

Cypress Way European Asset Investors II SARL

Claimant

Blue Skye Special Opportunities Fund L.P.

Defendant

Mr Salvatore Cerchione

Defendant

Mr Gianluca D'Avanzo

Defendant

Stepstone Acquisition Sàrl

Defendant

Blue Skye GP Ltd

Defendant

DBZ Special Investment (Lux) Sàrl

Defendant

Benlomond Corporation Sàrl

Defendant

Blue Skye Management Sàrl

Defendant

Blue Skye Capital Sàrl

Defendant

Blue Skye Management Sàrl SCS

Defendant

Greentea S.A.

Defendant

Blue Skye Financial Holdings Sàrl

Defendant

Omega Skye Partners Limited Partnership

Defendant

Omega Partners Sàrl

Defendant

Mr Mattia Mirko Danese

Defendant

Mr Francesco Paolo Padula

Defendant

Mr Giovanni Caslini

Defendant

BSKYE Investors Sàrl

Defendant

Procedural Posture

Commercial Court Proceedings (injunction and Related Applications) / Interlocutory Applications Following Grant of Injunction

Legal Issues

  1. 1 Whether further disclosure should be ordered against Mr Cerchione and Mr D'Avanzo regarding management fees and asset values
  2. 2 Whether fortification of the cross-undertaking in damages should be increased
  3. 3 Whether security for costs should be ordered against the claimants

Ratio Decidendi

The court refused further disclosure as sought, finding it disproportionate and unnecessary to police the injunction. The application for increased fortification was refused due to lack of specific evidence of risk of loss. Security for costs was ordered against the claimants, as their assets were illiquid and there was reason to believe they could not meet costs liabilities. A stay was granted under s.9 Arbitration Act 1996 for claims within the scope of the arbitration clause. Permission to re-re-amend the claim form was not opposed and granted.

Court Disposition

Applications determined as follows: further disclosure refused; increased fortification refused; security for costs ordered; stay granted for arbitration claims; permission to re-re-amend claim form granted.

Orders

  • Claimants' application for further disclosure refused except as resolved by agreement on management fees and expenses.
  • RPC defendants' application for increased fortification of cross-undertaking refused.