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Wednesday, November 4, 2009

Borsellino wins $11M in suit vs. former NYSE Prez Putnam

(Crain’s) — A Chicago jury has sided with a former trader on the Chicago Mercantile Exchange floor who sued former New York Stock Exchange President Gerald Putnam in a nine-year-old dispute over a business partnership.

The jury awarded Lewis Borsellino $11 million.

“I’m glad the world knows the former head of the New York Stock Exchange is a liar and a cheat,” Mr. Borsellino said after the verdict. Although “disappointed” by the dollar amount of the award — he had sought as much as $100 million — he said he felt “vindicated” by the verdict and the award.

Mr. Borsellino sued Mr. Putnam in 2000, alleging he was cheated out of a stake in a company that Mr. Putnam eventually built into Archipelago Holdings Inc., which later merged with the New York Stock Exchange in a deal that netted Mr. Putnam tens of millions of dollars.

Mr. Borsellino told the jury that he was tricked into selling his share in the firm, Chicago Trading & Arbitrage, for $250,000, less than 1/100th of what he argues it was worth at the time.

Mr. Putnam and co-defendants MarrGwen and Stuart Townsend argued that Chicago Trading & Arbitrage, which they founded with Mr. Borsellino, was completely separate from the enterprise that would become Archipelago, and denied Mr. Borsellino had any right to a stake in that company.

The jury found for Mr. Borsellino against all three defendants.

Jon Loevy, a lawyer for Mr. Borsellino, said he will appeal the judge’s decision not to allow punitive damages.

Mr. Putnam and Mr. and Mrs. Townsend declined to comment as they headed into an elevator on the Daley Center’s 21st floor shortly after the judge thanked and dismissed the jury.

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