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Nevada Supremes Begin "Consipio' Wrap-up

Nevada Supremes Begin

CARSON CITY, Nev.—In a ruling that feels like the equivalent of an umpire calling a baseball player out after the game is over and everyone has left the park, the Nevada Supreme Court issued an order Tuesday (in one of the three, now two, Consipio v. Private-related cases still pending before it) that denied a 2011 petition by Private Media Group founder Berth Milton, whose court battle with Private creditors and former CEOs has already resulted in his ignominious exit from the company at the metaphoric end of his opponent's boot.

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Milton had filed a Petition for Writ of Mandamus or Prohibition with the higher court in June of last year in order to challenge an earlier lower court ruling that had denied an earlier motion by Milton to have him personally dismissed from the case for lack of personal jurisdiction. He had argued that he deserved the same consideration other Private directors had received when the court agreed to sever them from the lawsuit for lack of personal jurisdiction. Milton, like the other directors, has had minimal to no personal connection to the state of Nevada, where Private is incorporated and where the plaintiffs in Consipio v Nevada had filed their lawsuit.

Neither court agreed with his arguments, however, and denied his petition. "Milton filed this petition for a writ of mandamus or prohibition requesting that we vacate the district court order denying Milton's motion to dismiss. Milton argued that the district court exceeded its jurisdiction by asserting personal jurisdiction over him and thus erred in denying his motion to dismiss. We disagree. Accordingly, we deny Milton's petition for writ relief."

In a footnote to the decision, the high court added, "We also lift the stay of the district court proceedings granted January 5, 2012."

The Jan. 5 stay order read, in part, "Having considered the motion, opposition, reply, and other documents before us, we grant the motion and stay the underlying district court proceedings in District Court Case No. A622802, pending further order of this court." Case No. A622802 is Consipio v Private.

After a series of motions requesting a clarification of the Jan. 5 order, the Supreme Court issued a clarification on Feb. 24, 2012, which stated that the stay was intended "only as to petitioner Berth H. Milton," and not to the case as a whole.

With that, the lower court was free to proceed with the denouement of the lawsuit by approving the results of the January shareholder meeting that replaced the board of directors with the so-called Consipio slate, thus effectively removing an opposing party from the legal field of battle. The court also ordered the court-appointed receiver, Eric Johnson, who remains a board member, to cease overseeing all day-to-day operations related to the running of Private, and placed that responsibility with the new board, which, in short order, voted to replace Berth Milton as CEO and president with former Private CEO Charles Prast, who has been representing the interests of creditor and now major Private shareholder Consipio Holdings throughout the lawsuit. He was named CEO, president and interim CFO.

All of this was accomplished previous to Tuesday's order denying Milton's 2011 petition. Two final cases remain on the Nevada Supreme Court docket, one of which—an appeal of the lower court's order severing several Private directors from the case for a lack of personal jurisdictionhas had a hearing before the court and is awaiting a decision; and the other of which—another petition by the defendants to overturn the lower court's August 2011 order appointing the receiver to oversee the day to day running of the company—is awaiting oral arguments, which were vacated by the Supreme Court in early March until "a status report with regard to any district proceedings stemming from January 1, 2012, shareholders' election and the impact any such proceedings have on this appeal" could be filed with it.

However, considering the fact that, as a direct result of the court's approval of the election results, the receiver is no longer running the company, the immediate effect of the original order being appealed—the assignment of the receiver—is no longer a reality, meaning the high court will probably just dismiss the appeal outright. Likewise, while some housekeeping business, including the official dismissal of the receiver, still needs to be completed by the lower court, for all intents and purposes it would appear that this bitterly contested lawsuit is all but over, unless some surprises await, which, considering the many bizarre twists and turns this case has already seen, is possible.

Whatever happens, the profound enmity felt by the parties remains, and runs deep; so much so that Berth Milton has decided to attempt an exorcism of his well-developed demons by way of a "tell-all movie" about his many years building Private into an industry leading brand, only to ultimately lose the company that, regardless of what anyone says, is not only his legacy but his father's, as well.

“A lot of people should be very scared about this movie—famous people, wealthy people, politicians,” Milton told the NY Post. “Even I myself won’t look that good, but I don’t care—it will be the truth.”

Whether the movie remains faithful to reality is another story, but does it really matter? Who can doubt that it will be Berth Milton's truth, and a compelling one at that, as told by a man literally birthed into an industry (and a family) built on the celebration of fantasy, obsession and self.






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