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Kochanski & Partners Successful for Forteam Investments in Ongoing Civil Suit Against Mariusz Switalski

Kochanski & Partners Successful for Forteam Investments in Ongoing Civil Suit Against Mariusz Switalski

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Kochanski & Partners has helped Forteam Investments overcome the attempt by Polish entrepreneur Mariusz Switalski to have the District Court in Poznan lift an injunction against him and his assets in an ongoing proceeding.

According to Forteam, which is controlled by the American private equity firm Delta Capital Partners Management LLC, the company is seeking approximately USD 86 million from Switalski -- who has been described in the media as one of the richest men in Poland -- and companies he controls. A second injunction was also obtained against Switalski and his four children -- Mateusz, Natasza, Marcin and Mikolaj -- in relation to their ownership of the Switalski FIZ investment fund.

According to a summary provided by Forteam, "by way of background, on May 8, 2015, Forteam purchased from Czerwona Torebka, a 100% stake in Malpka, the owner of the Malpka Express chain. Forteam eventually sold its 16.18% stake in Czerwona Torebka. The parties to that transaction were aware of Małpka’s challenging situation and thus acknowledged in the agreement that additional considerable financing would be needed in order for Małpka to remain afloat. Accordingly, Mariusz Switalski and Sowiniec Group contractually agreed to guarantee that Forteam would make a profit from its investment when it eventually exited the business. In connection with the issuance of the guarantee in favor of Forteam, Mariusz Switalski submitted a written declaration that his personal assets were sufficient to enable him to honor his obligations under the guarantee agreement. Despite having engaged a well-respected independent investment bank in 2018 to run a robust sales process for it, Forteam was only able to sell Malpka Express for an amount well-below the minimum set forth in the definitive transaction documents and related guarantee agreement."

According to Forteam, "on December 28, 2018, Forteam notified Switalski of its obligation to remit the monies owed to Forteam pursuant to the guarantee agreement. Notwithstanding, Switalski and his companies have failed to pay any amounts due and owing to Forteam, which necessitated the filing of the injunctions and civil lawsuits."

Speaking of the court's unappealable June 25, 2020, denial of Switalski's request that it lift the first injunction, Delta’s CEO Christopher DeLise said, “this decision bodes well for the success of our legal case against Mariusz Switalski. The court’s choice to deny Switalski’s appeal underscores the judges’ confidence in the merits of our legal arguments. Moreover, the attempt to conceal expensive cars at the Switalski family residence by changing their number plates ahead of our bailiff’s visit demonstrates desperate tactics to avoid fulfilling clear legal obligations. We understand that this matter with supporting evidence has been referred to the appropriate criminal prosecutor in Srem. We are also reassured by statements made last week by the Polish President and Prime Minister regarding the security and attractiveness of US investments in Poland. We are aware that this matter is being carefully observed by the American investment community.”

The Kochanski & Partners team representing Forteam is led by Partners Marek Jezewski and Michal Konig.

Editor's Note: After this article was published, the district court in Poznan granted a third injunction against against Druga-Sowiniec Capital sp. z o.o. S.K.A., a company controlled by Mariusz Switalski and Krzysztof Belcarz, securing 45.94% of Czerwona Torebka shares.

According to a Delta Capital Partners Management press release, "the injunction secured by Forteam concerns a claim that seeks to declare as invalid agreements to sell stakes in Czerwona Torebka S.A. (24,758,600 and 9,707,588 shares, respectively), executed in March 2020 between Switalski FIZ and the entities facing this injunction. Under the injunction, Forteam has secured [additional] Czerwona Torebka shares. In total, by force of the first (granted in February 2020) and third injunction, 48.44% of the Czerwona Torebka shares have been secured. Currently, 35.5% of Czerwona Torebka shares have been already seized by a bailiff, while the procedure is on-going for the remaining 12.94% of shares."

In addition, Delta Capital Partners reports "the transactions between Switalski FIZ, Druga-Sowiniec Capital, and Krzysztof Belcarz took place in March 2020 after the District Court in Poznan’s February 21, 2020 decision that granted Forteam an injunction against Mariusz Switalski and companies from Sowiniec Group under his controls (with the exception of Druga-Sowiniec). As a result of that ruling, Mariusz Switalski’s assets are frozen until the case is concluded."

Subsequently, on October 30, 2020, Kochanski & Partners announced that the Regional Court in Poznan had granted "a fourth successive injunction in favor of Forteam Investments." This time, the firm reports, "all assets of Druga – Sowiniec Capital, including a mansion in Sowiniec, surrounding grounds, and a polo club with horses, have been seized as a result of the seizure of shares under the court decision."

According to Kochanski & Partners, "the seized property covers a 279-hectare park, a mansion with an area of ​​over 3,000 square meters, 14 bedrooms, 24 bathrooms, an indoor swimming pool, and a tennis court. It also features a private marina on the Warta River, a helipad, a runway, a stable, two full-size polo fields, and a riding hall. The value of the entire property in 2015 was EUR 50 million. In addition, the injunction applies to all Switalski FIZ investment certificates and the related property rights, including shares in other partnerships controlled by the Switalski family. Moreover, under the injunction, the court regulated and defined Forteam’s rights and obligations in detail which allowed it to retain the property rights granted."

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