Sher Tremonte Wins $40 Million For Family Office in a Case of First Impression Involving SPACs
On October 27, 2023, the U.S. District Court for the Southern District of New York granted summary judgment in favor of Sher Tremonte’s client, Alta Partners LLC, in a case of first impression. The client, a family investment office, sought to exercise warrants issued by Getty Images Holdings, Inc., in connection with a de-SPAC transaction that took Getty Images public in July 2022. Alta alleged that Getty Images breached the agreement governing the warrants by refusing Alta’s attempt to profitably exercise the warrants in exchange for common stock. The agreement required that, before the warrants could be exercised, the common stock be registered with the SEC. Getty Images argued, among other things, that, the shares of common stock were registered merely for their offering, but not their sale, and that, consequently, the warrant agreement’s terms had not been met.
Accepting Sher Tremonte and Alta’s argument that the warrant agreement’s terms for exercise had been met when Alta attempted to exercise the warrants, the Court granted Alta summary judgment as to its breach of contract claim, awarding it approximately $40 million—the market value of the shares Alta stood to receive had Getty Images performed its obligations under the warrant agreement. This is a case of first impression that is likely to affect the outcome of multiple, similar lawsuits involving attempts to exercise warrants following de-SPAC transactions.
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