MONTREAL, Feb. 7, 2012 /CNW Telbec/ - The co-founder of Guess Jeans, Georges Marciano, has won another victory in his Quebec "iron arm" over the seizure of his assets and the recognition of the involuntary US bankruptcy declared against him without having the opportunity to present a defence. In a judgment rendered last Friday, the Quebec Court of Appeal acknowledged the businessman and the interested third parties' arguments and dismissed the demands of appellants (PricewaterhouseCoopers, American trustee David Gottlieb and former employees of Georges Marciano) to enforce major seizures carried out in Old Montreal in September 2011—while waiting for the Court of Appeal to pronounce itself on the judgment declaring them illegal.
On December 8, the Honourable Justice Schrager, of the Superior Court of Quebec, deemed the seizures illegal (money, property, artworks, luxury cars, jewels, etc.) and cancelled them.
The Court of Appeal did not uphold the appellants' arguments concerning the "urgency" of their requests and the fact that the cancellation of the seizures caused them an irreparable prejudice. "On the contrary, we must note that many of the assets in question are hardly likely to evaporate" wrote the Court, in French, in its decision.
PricewaterhouseCoopers has yet to reimburse the significant sums of money seized last September, despite having been ordered to do so on December 8, 2011. US trustee David Gottlieb might also be convicted for contempt of court for his own refusal to abide by Justice Schrager's judgment. The US trustee now maintains that the Quebec courts have no jurisdiction to sentence him for contempt of court. This matter will be debated before Justice Schrager on February 15 at the Montreal courthouse.
Review of the facts
In 2009, Georges Marciano, now established in Old Montreal, was sentenced by an American court to pay moral and punitive damages of over $260 million to seven former employees, based solely on the proceedings he initiated against them, without having the opportunity to present a full defence. The Honourable Justice Schrager's decision specified that moral and punitive damages of over $260 million would be deemed excessive under Quebec and Canadian law.
Even though the said judgments for damages are under appeal, the former employees obtained a US judgment in December 2010 to force Marciano into bankruptcy and took steps to have this judgment recognized in Canada in order to seize his assets.
In September 2011, the Superior Court of Quebec authorized a drastic seizure of Georges Marciano's assets. The seizures, which were requested by the American trustee and PricewaterhouseCoopers, were granted in secret, through a special procedure where Mr. Marciano was neither present nor represented.
On December 8, 2011, Justice Schrager cancelled the rulings of September 2011 and declared the seizures illegal. In his decision, Justice Schrager ordered the US Trustee Gottlieb and PricewaterhouseCoopers to return all assets seized to Mr. Marciano and the third parties involved. According to Justice Schrager, the attorneys for the former employees, the US trustee and PricewaterhouseCoopers had not fully and adequately revealed the existence of essential facts, including pending appeals in the United States.
For further information:
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