PULLMAN SUES KOPPELMAN
FOR $2.5 BILLION OVER BONDS

Billboard Bulletin
November 17, 1999

The Pullman Group, creator of entertainment securitization bonds, has filed a $2 billion-plus lawsuit against Charles Koppelman's CAK/Universal Credit Corp. and its partner, Prudential Securities, among others.  The suit, filed yesterday in New York State Supreme Court, alleges breach of contract, breach of fiduciary duty, misappropriation of trade secrets, conversion, tortious interference, and unjust enrichment.

The Pullman Group claims that it and its former partner, business management firm Rascoff/Zysblat Organization (RZO) sought to set up  a joint venture with Prudential in 1997.  Prudential and RZO --- also a defendant in the suit --- then "improperly and abruptly ceased their affiliation with the Pullman Group" and "consummated precisely the same deal between themselves," according to a Pullman statement.  Pullman charges that Prudential then "misappropriated proprietary and confidential information" to form and finance CAK, which has since "attempted to disrupt pre-existing relationships between the Pullman Group and its current and potential clients and to usurp potential business opportunities."

Koppelman, former chairman of EMI-Capitol Music Group North America, last year set up CAK to make loans with intellectual-property rights serving as collateral; the company has inked deals with TVT Records and SESAC.  The Pullman initiated the securitization concept with David Bowie; the company has since inked deals with James Brown, Holland-Dozier-Holland, and others.

The Pullman Group seeks total claims of more than $2 billion plus $500 million in punitive damages.  Representatives of CAK could not be reached for comment.

- Carolyn Horwitz