SDCCU and Cal Coast legal battle over the proposed merger.
No matter how a judge rules on a highly contested merger deal between the $3.4 billion Cal Coast Credit Union and the $9.2 billion San Diego County Credit Union (SDCCU), both institutions are preparing for what could be a lengthy legal battle, new court filings showed.
California Judge Carolyn M. Caietti said she expected to make a ruling this month to decide on a Cal Coast preliminary injunction motion that would block SDCCU's termination of the merger agreement with Cal Coast.
As both credit unions wait for a ruling, they filed case management statements last week outlining the expected next steps in the litigation. Both sides are also required to submit these statements ahead of a case management conference scheduled for May 1.
While Cal Coast and SDCCU are requesting a jury trial, Cal Coast has paid a $150 nonrefundable jury fee that will maintain its right to a jury trial, according to California's Code of Civil Procedure.
Cal Coast also has indicated it would be willing to participate in a mediation or settlement conference, according to its case management statement. SDCCU has not indicated the same.
Cal Coast's case management statement also showed it plans to ask Judge Caietti to resolve the merger agreement dispute without a jury.
Alternatively, Cal Coast also said it will seek damages in a subsequent jury trial.
In March, during a five-hour court hearing, both credit unions presented their legal arguments before Judge Caietti. Cal Coast claimed SDDCU manufactured excuses to re-trade the agreement's fundamental terms. SDCCU countered it had the right to cancel the consolidation, alleging Cal Coast breached the agreement through nondisclosures and false representations.
If the judge grants the preliminary injunction it would prohibit SDCCU from taking actions that would prevent the merger from being completed. But forcing the consolidation, SDCCU argued, would not work because the financial cooperatives are incompatible.
Peter Strozniak can be reached at peter.strozniak@arc-network.com.
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