Jonathan E. Pickhardt

The bank could have waited in a pending class action. Instead it opted out and, in December 2012, filed its own FINRA arbitration — a forum with no jury, no published opinion, and no appeal to speak of, where the case would be won or lost on how well the panel came to understand a structure most lawyers cannot diagram.

Jonathan E. Pickhardt served as lead counsel. Over a three-week hearing he reconstructed the product for the panel — its cash flows, priorities, disclosures, counterparties, conflicts, performance, and losses — and presented fraud and unjust-enrichment claims within FINRA's discovery, motion, and hearing procedures.

The panel awarded National Australia Bank more than $100 million: the full $80 million principal, plus roughly eight years of interest. It stands as one of the largest awards in FINRA's history, and The Wall Street Journal ran the story under a two-word banner: "Goldman Punished."

The Enjoined $3 Billion Sale

BankAtlantic's parent company proposed to sell the bank to BB&T — a transaction valued around $3 billion — without requiring the buyer to assume the parent's obligations under the indentures governing its trust-preferred securities. The holders of those securities would be left looking to a shell.

Pickhardt tried the case first chair in the Delaware Court of Chancery, and the trial went beneath the deal's labels to its economic substance. He combined the indenture's successor-obligor language with valuation and operational evidence about what would actually remain after closing: the court found that retained assets functioned as consideration, that roughly eighty-five to ninety percent of the parent's assets would be transferred, and that the company would exit the banking business entirely.

That, the court held, was a transfer of substantially all assets. The sale would breach the successor-obligor provision and trigger an event of default. Finding success on the merits, irreparable harm, and a balance of hardships favoring relief, the court permanently enjoined the transaction — protection delivered before the transfer occurred, not damages collected after it.

Nine Years Later, the Error Surfaced

Sceptre concerned residential mortgage-backed securities and a discrepancy hiding in the deal documents. The prospectus and term sheet said one thing about the priority of two note classes. The indenture — the operative contract — said the opposite, reversing the loss allocation. Nine years had passed since execution, and the question of whether an RMBS indenture could be reformed at that distance to correct a scrivener's error was one of first impression in New York.

At a three-day federal bench trial, Pickhardt joined the drafting history, the document structure, and the transaction materials to isolate the specific mistake and the priority the parties had actually agreed to. The court found clear and convincing evidence of a drafting error, traced the changes made during the documentation process, and ordered the indenture reformed to restore the intended seniority. The paper was made to say what the deal had always meant.

Thirty Days to Sell

South Tryon presented the opposite discipline: not fixing a contract, but enforcing one to the letter. Defaulted residential mortgage-backed securities — more than $500 million of them — sat in a Triaxx CDO portfolio, and the collateral manager was not selling. The indenture required disposition once securities had remained in default for three years; the manager claimed discretion to hold.

Pickhardt led the investor's effort and moved for summary judgment at the outset. The Southern District of New York agreed the contract was unambiguous: it identified the qualifying securities, ordered them sold within thirty days, and directed that future securities reaching the same default threshold be sold on the contractual timetable. The Second Circuit affirmed. Asserted discretion did not override a mandatory sale provision — a rule established both for the securities at hand and for every asset that would follow them across the three-year line.

The Right Remedy in the Right Room

Four matters, four different forms of relief: an arbitral damages award, a permanent injunction after trial, reformation following a bench trial, summary judgment and appellate affirmance compelling asset sales. Pickhardt's teams identify the economic right at issue before developing the proof. A completed investment loss calls for damages. A pending asset sale may require an injunction to preserve an indenture protection. Conflicting deal documents may require reformation. Refusal to follow a mandatory disposition provision supports specific relief.

Then the forum shapes the presentation: product economics and live testimony for arbitrators, valuation and operational substance for Chancery, drafting history for a federal judge, contractual triggers for summary judgment and appeal.

Zohar

Pickhardt represents three Zohar collateralized-loan-obligation funds and Alvarez & Marsal Zohar Management in sprawling disputes with Patriarch Partners and Lynn Tilton — litigation over ownership of portfolio companies, access to books and records, and claims arising from management of the funds, including an action seeking more than $1 billion for alleged fiduciary breaches and related misconduct. The matters demand exactly what his career has built: fluency in CLO structures, fund-management authority, portfolio-company ownership, and the contractual and fiduciary duties layered on top of them.

Financial Services Practice

Pickhardt is a partner at Quinn Emanuel Urquhart & Sullivan and co-chair of its Financial Services and Structured Finance Litigation practices. His matters require reconstruction of transaction waterfalls, contractual priorities, disclosures, drafting histories, delegated powers, default triggers, and the commercial function of the disputed instrument — and he has carried that reconstruction successfully before arbitrators, the Court of Chancery, federal trial judges, and federal appellate panels.

He graduated magna cum laude from New York University School of Law, where he served as Editor-in-Chief of the New York University Law Review.