Delaware Court Sanctions TransPerfect Co-owner for Lying Under Oath and Destroying Evidence

NEW YORK, July 26, 2016 /PRNewswire/ -- Wednesday, July 20, 2016, The Delaware Chancery Court issued a scathing sanctions ruling against TransPerfect co-owner Phil Shawe, ordering him to pay what will likely amount to many millions of dollars of his opponent's attorney's fees for having repeatedly lied under oath and engaged in massive spoliation of evidence. The decision ends the long legal dispute (though a Shawe appeal is possible) over the ownership of the billion-dollar company and marks a complete victory for co-owner Elizabeth Elting, represented by Kramer Levin Naftalis & Frankel LLP, who brought the lawsuit against Shawe asking the court to appoint a custodian to sell TransPerfect.

In Wednesday's sanctions ruling (available upon request), Chancellor Andre G. Bouchard cites roughly 20 instances of lying under oath as well as spoliation of evidence by Shawe, and states:

• "Shawe's repeated false statements under oath during the course of this litigation plainly support the conclusion that Shawe subjectively acted in bad faith to obstruct discovery and conceal the truth about activities relevant to this case." (see page 49)
• "In sum, I find that Shawe's pervasive false statements under oath concerning who assisted him in accessing Elting's hard drive and the deletions made to his laptop were made intentionally to conceal the truth of his surreptitious activities." (see page 51)
• "Shawe deleted 19,000 files from [his] laptop on December 19 [2014]" and, using a forensic wiping program called CCleaner, "sat with [a TransPerfect employee] and identified 22,000 [additional] files that he wanted [that employee] to delete" on December 22, 2014. (see pages 16, 19)

The sanctions ruling follows Chancellor Bouchard's ruling in August 2015 ordering the sale of the company and appointing Skadden Arps Slate Meagher & Flom partner Robert Pincus to serve as custodian to file a proposed plan of sale; his ruling last month approving Pincus's plan to sell the company at auction, over Shawe's strenuous objection; and his order on Monday, again over Shawe's objection, setting forth the custodian's broad powers in implementing the sales process.

Ms. Elting is represented by Philip S. Kaufman and Ronald S. Greenberg of Kramer Levin Naftalis & Frankel LLP.  Mr. Kaufman is available to answer questions on background. About the sanctions ruling, Mr. Kaufman said:

"This chapter completes Ms. Elting's total victory. The court's strong language in condemning Mr. Shawe's misconduct, like the court's previous rulings, further confirms why it was necessary for Ms. Elting to ask the court for all of the relief she has now obtained."

Also about the ruling, Ms. Elting said: "I'm gratified that the court recognized Mr. Shawe's misconduct and is holding him accountable for it."

Contact: Peter Pochna
Organization: Rubenstein Associates
Email: [email protected]

SOURCE Kramer Levin Naftalis & Frankel LLP