WEDNESDAY UPDATE: The jury came back today with an additional judgment of $500,000 in punitive damages.
TUESDAY 7:15 PM: Deadline has learned that a Los Angeles Superior Court jury today unanimously awarded the controversial film financier David Bergstein the $49.5 million damages against his former in-house counsel Susan Tregub at Capitol Film for breach of fiduciary duty and legal malpractice. But this isn’t over yet. Today’s verdict determined that Tregub (now in private practice) acted with malice, so the second phase of the trial involving punitive damages will start tomorrow when the monetary figure could go higher.
The two-year case arose from Tregub going to work for Aramid Entertainment Fund in 2009 after Capitol. That move is what Bergstein claimed lead to Aramid and its principal David Molner pushing five of his companies including Capitol and Thinkfilm into bankruptcy and causing him $269 million in damages. Tregub admitted that, after she was no longer working for Bergstein, she did work for the other side. A series of emails shown during the trial were offered to show Tregub had provided confidential information. The 2009 and early 2010 correspondence between Tregub, Aramid, Molner and the company’s lawyers made up the bulk of the evidence in Bergstein’s case. And it was not a pretty picture. Even Tregub’s own attorney Hayes Michel admitted at one point in the trial that his client probably conducted herself unprofessionally with her behavior toward Bergstein and Capitol Film. The jury agreed with Bergstein’s argument that Tregub breached her legal and fiduciary duties to him. The verdict in the case, which was first filed in March 2010, came after a week and a half trial in front of Superior Court Judge J. Stephen Czuleger.
Construction tycoon Ron Tutor also had been a plaintiff with Bergstein in the case but then dropped out earlier this year.
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This isn’t the only case Bergstein has going on this matter. Earlier this year, Bergstein sued LA law firms Stroock & Stroock & Lavan and Levene Neale Bender Yoo & Brill for their part in Tregub switching sides. Seeking at least $100 million in damages, Bergstein claims the firms, who represent Aramid Entertainment’s Molner and other creditors in their bankruptcy cases against Bergstein, gained confidential information about him and his companies from Tregub while she worked for him. No trial date has been set for the case against the law firms. In the current case, Hayes Michel of Baker Hostetler represents Tregub. Bergstein was represented by Lucia Coyoca of Los Angeles firm Mitchell Silberberg & Knupp.