Akerman Senterfitt to Distribute Comprehensive Case Study on Florida NorVergence Victory at Equipment Leasing Event

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Lessors Network Annual Showcase, August 24-25, the Ritz-Carlton, Buckhead, Atlanta, GA.

The Lessors Network today confirmed Albert F. Tellechea, the Akerman Senterfitt shareholder participating in the Roundtable Discussion "Norvergence - What Have We Learned?" will be providing conference attendees with a comprehensive case study regarding the recently rejected Florida lawsuit filed by the State that had accused twelve national finance companies of violating the Florida Deceptive and Unfair Trade Practices Act. Tellechea is the shareholder in charge of the case representing Popular Leasing, Inc. He will explain how Judge Cole's ruling upholds three of the four pillars relied on by the commercial equipment leasing sector. Also, the case study will cover trial strategy, the role early discovery played and the advantages of challenging the plaintiff's legal theory(ies) early. Aggressive litigation discourages others from suing and fosters more reasonable settlements."

In June 2004, NorVergence filed bankruptcy in New Jersey and ceased phone service. The leased telephone equipment remained with its customers. After the bankruptcy filing, the State of Florida filed the now dismissed law suit seeking to invalidate the leases purchased by the ten remaining defendants, have them disgorge all the payments received, and impose treble damages and penalties and attorneys' fees and costs. The complaint asked the Court to rule that three major clauses in the lease agreements (the unconditional obligation to pay known as the "hell or high water" clause, the waiver of defenses and warranties clause, and the law and forum selection clause) signed by NorVergence's customers made these leases unconscionable and contrary to public policy.

In dismissing the case with prejudice, Judge Cole ruled that the three clauses attacked by the State were specifically authorized by the laws of the State of Florida and therefore not unconscionable or contrary to public policy. The Court also ruled that because the defendants are regulated by federal and state agencies, Florida's unfair trade practices law does not apply to them. The Court found the equipment leases in question were not consumer leases.

"NorVergence's clients voluntarily signed contracts that clearly spelled out these terms and their obligations," said Tellechea. "The defendant equipment finance companies that purchased these contracts from NorVergence are entitled to rely on the written word and representations contained in the contracts. Without those protections, the secondary equipment financing market would dry up or interest rates would soar to compensate for the higher risk."

According to Tellechea, the value of the contracts Popular Leasing is seeking to enforce amounts to approximately $3 million in Florida and $30 million nationally. The other defendants covered by Judge Cole's ruling have an estimated $250 million in equipment lease payments at risk nationally. At the time of its bankruptcy, NorVergence still had in its possession a portfolio of equipment leases amounting to $50 million not sold to third parties.

The Akerman Senterfitt team of shareholders representing all the defendant finance companies was composed of Bruce Culpepper in Tallahassee and Albert F. Tellechea and William C. Turner in Orlando. Judge Cole's dismissal with prejudice means that the State cannot file another amended complaint.

About Akerman Senterfitt

With more than 400 attorneys, Akerman Senterfitt has offices in Orlando, Miami, Fort Lauderdale, Tampa, Jacksonville, West Palm Beach, Tallahassee and Washington, D.C. The firm represents private and public companies, governmental entities, educational establishments and high net-worth individuals in a wide range of practice areas. Additional information can be viewed at http://www.akerman.com .

About The Lessors Network

The Lessors Network serves as an online networking enterprise for equipment leasing professionals. Online resources point the world to lease funding, technology and outsourcing solutions. Always hosted from the beautiful Ritz-Carlton, Buckhead hotel in Atlanta, Lessors Network events deliver a professionally intimate showcase culture refined to embrace a standard that today's senior equipment leasing executives and their customers find particularly effective. Additional information can be viewed at http://www.lessors.com.

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