Fifteen years after cementing his reputation battling the tobacco industry, Michael Ciresi of Robins, Kaplan, Miller & Ciresi made headlines this week for winning an eye-popping $2.76 billion arbitration award for Kraft Foods Inc. in a contract dispute with Starbucks Corp. And as different as the two cases are, one victory may have paved the way for the other.
In 1998, Kraft inked a deal to serve as the exclusive distributor of Starbucks packaged coffee in grocery stores through 2014. Starbucks announced in 2010 that it would back out early, claiming Kraft wasn’t holding up its end of the bargain and was doing lasting damage to the Starbucks brand. Kraft commenced an arbitration against Starbucks in 2010, seeking about $2.9 billion in damages and interest.
Kraft’s general counsel at the time, Marc Firestone, previously worked at Philip Morris Companies Inc. According to Ciresi, after meeting with a few suitors for the case, Firestone and his colleagues selected Ciresi to handle the Starbucks arbitration. They apparently didn’t resent him for taking on Kraft’s former parent company in State of Minnesota v. Philip Morris, which ended in a $6 billion settlement on the eve of closing arguments. “That litigation was extremely contentious,” Ciresi told us. “But there’s a mutual respect among the lawyers on both sides.”
The partnership seems to have worked out quite well. After a month-long bench trial in the Starbucks case, Kraft announced Tuesday that a JAMS Inc. arbitrator based in Chicago had awarded the company $2.23 billion in damages and $527 million in interest. All proceeds from the judgment will go to Mondelez International Inc., which spun off Kraft in 2012. Mondelez is also entitled to attorney fees in a yet-to-be-determined amount. Aaron Panner and Wan Kim of Kellogg, Huber, Hansen, Todd, Evans & Figel represented Starbucks. They did great job, Ciresi said, but were “dealt a tough case.”
While he’s best known for his mass tort cases, Ciresi said he’s happy to represent corporations in certain kinds of business disputes. “Our firm was founded by two Jewish lawyers who could not get jobs at Minneapolis’ top law firms because of anti-Semitism. The founding principle was that we’d take cases for all segments of society, so long as the cause was just,” Ciresi said. “That’s been the history of my practice.”
As someone who represents both sides, Ciresi said he is troubled by bitter divisions between the plaintiffs and defense bars.
“I’m not one to say it was always better in the old days, but I do think the tendency to demonize the other side has sort of built up in the past few decades,” Ciresi said. “It’ll take leaders of the bench and bar to change that.”
