LOUISVILLE, Ky.--(BUSINESS WIRE)--
On July 16, 2013, a jury in Louisville, Kentucky returned a verdict against PBI Bank, the banking subsidiary of Porter Bancorp, Inc. (PBIB), awarding the plaintiffs compensatory damages of $1,515,000 and punitive damages of $5,500,000.
The case arose from a settlement in which PBI Bank agreed to release the plaintiffs and guarantors from obligations of more than $26 million related to a real estate project in Louisville. The plaintiffs were granted a right of first refusal to repurchase a tract of land within the project. In exchange, the plaintiffs conveyed the real estate securing the loans to PBI Bank. A third-party made an offer to purchase the tract of land. After plaintiffs declined to exercise their right of first refusal, PBI Bank sold the tract to the third-party. Plaintiffs alleged that the Bank had knowledge of the third-party before the conveyance of the land by the Plaintiffs to the Bank. Plaintiffs asserted claims of fraud, breach of fiduciary duty, breach of the duty of good faith and fair dealing, tortuous interference with prospective business advantage and conspiracy to commit fraud, negligence, and conspiracy against PBI Bank.
After conferring with its legal advisors, PBI Bank believes the findings and damages are excessive and contrary to the law, and that it has meritorious grounds to seek reconsideration of the verdict and to appeal. PBI Bank intends to file motions to reduce or overturn the award and otherwise for reconsideration of the case.
About Porter Bancorp, Inc.
Porter Bancorp, Inc., a bank holding company headquartered in Louisville, Kentucky, had $1.1 billion in assets as of March 31, 2013. Through Porter’s subsidiary PBI Bank, it operates 18 full service banking offices in Kentucky. Porter Bancorp’s common stock is traded on the Nasdaq Capital Market under the symbol “PBIB.”
Statements in this press release relating to Porter Bancorp’s plans, objectives, expectations or future performance are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “may,” “should,” “anticipate,” “estimate,” “expect,” “intend,” “objective,” “seek,” “plan,” “strive” or similar words, or negatives of these words, identify forward-looking statements. These forward-looking statements are based on management’s current expectations. Porter Bancorp’s actual results in future periods may differ materially from those currently expected due to various risks and uncertainties, including those discussed under “Risk Factors” in the Company’s Form 10-K and subsequent periodic reports filed with the Securities and Exchange Commission. The forward-looking statements in this press release are made as of the date of the release and Porter Bancorp does not assume any responsibility to update these statements.
John T. Taylor, 502-499-4800