Uzans To Motorola, U.S. Court: We're No-Shows
Matthew Swibel, 02.06.03, 6:00 PM ET
forbes.com
WASHINGTON - Don't expect to see any member of Turkey's wealthy Uzan family in New York District Court Monday for the scheduled trial of their alleged $2.7 billion default on vendor financing made by Motorola and Finland's Nokia to the family-controlled and second-ranked Turkish mobile phone company Telsim.
According to court documents made available to Forbes, the Uzans contend that injunctions issued in Turkish courts preclude the clan from participating in the trial, and oppose the jurisdiction of U.S. courts over the case and themselves. Failing to obey the Turkish courts' orders would subject the Uzans to criminal sanctions in Turkey, according to the Uzan's lawyers at Baker Botts and Gibson, Dunn & Crutcher.
The Turkish court wrote that its orders were "to protect the irreparable damage and harm...to the commercial reputation, individual rights and personal property of the [Uzans]" The court also said the dispute between Telsim and Motorola should be resolved through arbitration in Switzerland as called for in the contract and that all actions and proceedings in foreign courts be stopped.
Yet the family, whose wealth Forbes estimates at $1.3 billion, could face serious consequences for their no-show. On Feb. 3, a British court sentenced patriarch Kemal Uzan and Murat Hakan Uzan, one of his two sons, to 15 months in prison for contempt after the two men failed to attend court-ordered examinations by Motorola (nyse: MOT - news - people ) lawyers. In Britain the same ruling was handed down last year to Kemal's other son and budding Turkish politician, Cem Uzan.
In January 2001, Motorola and Nokia (nyse: NOK - news - people ) filed fraud charges against the Uzans under U.S. antiracketeering laws, seeking to recover almost $3 billion in loans plus damages (see: "Dial 'D' For Dummies"). In earlier filings with the Securities and Exchange Commission, Motorola told its shareholders that Telsim had only breached a contract. The Uzans' defense: When Motorola and Nokia filed suit, they broke the terms of the contract, which called for all disputes to be reviewed and settled with Swiss arbitrators.
The Uzans deny any wrongdoing and live freely in Turkey. Motorola finished writing off its bad investment last year and has yet to collect a penny from the billionaire bunch. Meanwhile, class action lawsuits have been filed in the U.S. District Court for the Northern District of Illinois against Motorola and certain executives for allegedly failing to disclose material adverse facts about the Telsim arrangement. |
