Kevin Kehrli Prevails before the Second Circuit

Kevin Kehrli prevailed in the Second Circuit in LG Capital Funding, LLC v. CardioGenics Holdings, Inc. 18-1797-cv in which the Circuit agreed that the District Court had incorrectly subtracted from the actual loss calculation the unpaid principal and unpaid interest that CardioGenics owed LG under the Note as of the date of breach. As can be seen in the judgment below, the Circuit held “in subtracting the conversion price from the damages award, the District Court awarded LG the equivalent of its lost profits on the conversion, but not the full value of the shares. Far from double recovery, this resulted in an award that fell well below the “economic position [LG] would have occupied” had CGNH delivered the shares.”

This important decision in the correct calculation of damages where a purchased note is not converted and the issue of the note fails to repay the principal and interest.

Kevin Kehrli is an associate at GS2Law and can be reached at kk@gs2law.com