BOULDER, Colo., Sept. 5 /PRNewswire/ -- New Frontier Media, Inc. (Nasdaq: NOOF), a leader in the electronic distribution of adult entertainment, announced today that it intends to file appropriate post trial motions and move for appeal, if necessary, in Lipson v. New Frontier Media, Inc. et al., in which a six-person jury found the Company liable for claims stemming from a letter of intent entered into between the Company and J.P. Lipson in October, 1998.
The jury found that Mr. Lipson is entitled to liquidated damages of 10 million on his claims for breach of contract and breach of the covenant of good faith and fair dealing, and 1 million actual damages and 1 million punitive damages on his claims for fraudulent inducement and fraudulent concealment. The Company's Chairman, Mark Kreloff, and Executive Vice President, Michael Weiner, were each found individually liable for an additional 125,000 in compensatory damages and 125,000 in punitive damages.
Because the amounts awarded on various claims are alternative rather than cumulative remedies, the Company therefore anticipates that Mr. Lipson will be required to elect between recovery on his fraud or contract claims. Mr. Lipson had sought damages in excess of 25 million on his contract and fraud claims, plus punitive damages. The Court has not yet entered judgment in the case. Colorado law also provides for a 15-day automatic stay once judgment is entered and the Court has the discretion to impose a further stay.
The Company is exploring various financing alternatives to fulfill the terms of the verdict should it become necessary.
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