David v. Goliath Revisited; Allcom Electric's Owners, Marino and Petersen, Prevail in Black Box Arbitration, Are Awarded Attorne
March 23 2004 - 3:46PM
PR Newswire (US)
David v. Goliath Revisited; Allcom Electric's Owners, Marino and
Petersen, Prevail in Black Box Arbitration, Are Awarded Attorneys'
Fees NEW YORK, March 23 /PRNewswire/ -- In a classic match up of
right vs. might, Edward J. Marino and Thomas J. Petersen, one-time
owners of Allcom Electric, Inc., and their former Chief Financial
Officer, Edward Johnston, earned a decisive victory in arbitration
with infrastructure services giant Black Box Corporation of
Pittsburgh. The matter was decided by Donald Ziegler, former chief
judge of the U.S. District Court for the Western District of
Pennsylvania, under the auspices of the American Arbitration
Association. Mr. Petersen who resides in Upper Saddle River, NJ,
was represented by Donna M. Doblick, an attorney at Reed Smith LLP,
Pittsburgh. "I am very gratified, but not surprised, by the
vindication represented by this decision, which is overwhelmingly
in our favor on all counts," said Mr. Petersen. "Every one of the
allegations Black Box managementmade has been thoroughly examined
by Mr. Ziegler and found to be completely without merit. I believe
this ruling will go far in restoring the excellent reputation we
and our company enjoyed prior to becoming a part of their
organization." Allcom Electric, Inc., founded in 1993 in New York
City by Mr. Marino, provided electrical and cabling design,
installation and maintenance services. With sales exceeding $20
million annually, Allcom was acquired by Black Box in mid-2000 with
high expectations for the merger's success in the period's very
dynamic New York market. After a series of missteps on the part of
Black Box, however, Allcom was closed in 2003, amidst unfounded
allegations circulated by Black Box that Mr. Petersen, Mr. Marino
and Mr. Johnston were responsible for the company's failure. Black
Box unsuccessfully sued to rescind the purchase, erroneously
alleging that Mr. Petersen and Mr. Marino had induced Black Box
into purchasing Allcom by misrepresenting the estimated
profitability of certain jobs, misrepresenting the profitability of
the company as a whole, and misrepresenting the "earned not billed"
amounts of other jobs. Black Box also unsuccessfully and
erroneously claimed that Mr. Petersen and Mr. Marino's affiliation
with the employment service company known as Crafted Resources
violated their non-competition agreements with Black Box. The late
December 2003 arbitration decision tells a very different and more
truthful tale. Mr. Ziegler wrote, "the demise of Allcom had little
to do with the alleged errors and omissions of respondents
(Petersen, Marino and Johnston), and much to do with the errors and
omissions of Black Box." Mr. Ziegler specifically detailed five
specific errors and omissions made by Black Box, including
acquiring another company known as InTec without adequate due
diligence and combining the books and records of InTec with those
of Allcom. He also noted that Black Box failed to establish a
corporate chain of command in New York, failed to resolve a billing
dispute with Goldman Sachs and withdrew from Allcom's high voltage
electric market, which had been Allcom's strength in the New York
market. "These systemic handicaps, coupled with external market
conditions provided the end-game for Allcom," Mr. Ziegler wrote. On
March 1, 2004, Arbitrator Ziegler also ordered Black Box to
reimburse Messrs. Petersen, Marino, and Johnston for the more than
$1 million in legal fees and expenses they incurred defending
against Black Box's allegations. "I am pleased that this matter is
over," said Mr. Petersen. "It's always difficult for individuals to
defend themselves against a major corporation, but when you've got
the truth on your side, that's a powerful weapon." Mr. Petersen
also observed that it was "a shame to see a company that was poised
to do great things get dragged down by poor leadership, as
Arbitrator Ziegler appreciated was the case here." DATASOURCE:
Thomas J. Petersen CONTACT: newsPRos: +1-201-493-1027, for Thomas
J. Petersen x
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