A Colorado Springs businessman has won a $4.3 million jury verdict in a dispute over a soured deal to sell his employment-leasing company to a competitor in 1999.
A jury in federal court in Denver last week awarded The Personnel Department Inc., which Barry Farah, 43, founded and owns, $2.5 million in actual damages and $1.8 million in punitive damages in his lawsuit against Rockville, Md.-based ProLease Corp.
“It’s very gratifying, after a long time period, to bring these people to justice,” said Denver lawyer Bruce Featherstone, who represented Farah. “The jury found for us in every important regard, including in the measurement of damages. Fundamentally, we got what we were asking for.”
Featherstone said he filed a motion Friday seeking an additional $1.5 million in interest.
ProLease vowed to continue fighting.
“We are very confident that the verdict will be overturned on appeal,” said Stanley Goldschmidt, the Washington, D.C., lawyer representing ProLease.
Farah first met ProLease founder and chief executive Bala Ramamoorthy at an informal meeting at Denver International Airport in December 1998. A month later, they signed a letter of intent in which ProLease would buy its smaller Colorado Springs competitor in the employee staffing business for $4.5 million.
The Personnel Department said the letter was not binding. Either party could back out if no formal contract were signed. ProLease was to make a $50,000 earnest deposit, money that The Personnel Department said was never paid. ProLease said it sent a check, Featherstone said.
Negotiations broke down, and Farah backed out of the deal in February 1999. ProLease sued The Personnel Department.
Farah then entered negotiations with another competitor, Littleton’s Global Employment Solutions. Global agreed to pay $5.5 million for The Personnel Department, but in August 1999 it backed out because of the ProLease lawsuit.
“As a result of (ProLease’s) bringing that baseless lawsuit, The Personnel Department lost the ability to sell itself to Global at a very attractive price,” Featherstone said.
Farah countersued ProLease in September 1999.
He said ProLease’s lawsuit against The Personnel Department was filed in revenge for the soured deal. The verdict will deter others from filing lawsuits in bad faith, he said.
Staff writer Greg Griffin can be reached at 303-820-1241 or ggriffin@denverpost.com.
