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Damages Could Total $30 Million : Polaroid Loses Suit Over Disclosure of Finances

July 06, 1987|Associated Press

BOSTON — Polaroid Corp. has been found liable for damages that could amount to $30 million in a suit involving allegations that company officials sold stock without revealing information about the company's problems.

A six-person jury in U.S. District Court here reached its decision after one day of deliberations. The amount of damages will be decided in a separate trial scheduled to begin this week.

Samuel A. Yanes, Polaroid director of corporate communications, said the verdict would be appealed.

The civil suit was brought against Polaroid by Irving Backman, a Boston securities trader, who claimed that Polaroid officials and founder Edwin Land should have given more notice of problems with the company's ill-fated Polavision instant movie system.

Yanes said the suit centered on the public information provided about Polavision during fiscal 1978, the company's best financial year, but he said the company had several times announced that Polavision was a drain on earnings.

The plaintiffs argue that Polaroid should have given more information about the Polavision drain, Yanes said, particularly to people who bought the stock between Jan. 9 and Feb. 22, 1979.

On Jan. 9, the Rowland Foundation, Land's family foundation, announced that it would be selling shares to pay for a new institute of science. Yanes said the foundation sold 300,000 shares, raising about $15 million.

Witnesses testified that shareholders who lost money after Land's foundation sold its stock should be reimbursed $6.75 a share. Defense attorneys say the total would amount to $30 million.

"We're very pleased with the verdict," said Backman's lawyer, Thomas G. Shapiro.

Backman had also sued Land personally, but Land settled the suit last month for $600,000. Yanes said Land agreed to the settlement because he didn't want to spend time in court.

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