Cleary Gottlieb obtained another victory for longstanding clients Fresh Del Monte Produce Inc. and its principal shareholder IAT Group Inc. when Justice Ramos of the New York State Supreme Court ruled that IAT was entitled to $2.4 million in prejudgment interest on the $9.5 million judgment that Cleary obtained against Eastbrook Caribe A.V.V. on April 11.
Although the award of prejudgment interest in a breach of contract case is normally mandatory under New York law, the issue was hotly contested, with Eastbrook arguing that the $9.5 million cap on the indemnity agreement at issue precluded an award of prejudgment interest on top of the $9.5 million already awarded as damages. The Court decided that the language of the $9.5 million cap did not constitute a waiver of prejudgment interest and that IAT was therefore entitled to prejudgment interest dating back to the accrual of its cause of action in November 2002, when Eastbrook sued IAT in breach of a prior settlement agreement and release.