The defendants asserted common arguments in support of dismissal, but all arguments made in support of dismissal were not asserted by each defendant. A former Wellspring Capital Management employee filed a lawsuit against the son of Wellspring chief executive Bill Dawson, alleging that he raped her and that Bill Dawson threatened to. New York law requires insolvency at the time of the transfer, and South Carolina law requires insolvency both at the time of the transfer, and at the time the creditor seeks to collect the debt. Since its founding in 1995, Wellspring has raised over $4 billion of initial capital commitments through . We look forward to hearing from you. As we here at Ropes & Gray look back on 2021 and ahead into 2022, we call your attention to the lessons of Friedman v. Wellspring Capital Mgmt., LLC (In re SportCo Holdings, Inc.), Case No. 2005)). 0
The firm's objective is to bring partnership, experience and value creation to each investment. Limited partners include leading pension funds, endowments, fund of funds and family offices from the U.S., Europe and Asia. After all, corporate decisionmakers are often tasked with choosing a path where outcomes are at best uncertain. Since its founding in 1995, Wellspring has raised over $4.5 billion of initial capital commitments through six private equity funds. Many of the facts underlying the Wellspring decision are neither unique nor unusual. This is the best way to manage and repair your business reputation. Law360 provides the intelligence you need to remain an expert and beat the competition. The defendants filed separate motions. Exempt Reporting Advisers ("ERA") are investment advisers that are not required to register as investment advisers because they rely on certain exemptions from registration under sections 203 (l) and 203 (m) of the Investment Advisers Act of 1940 and related rules. Brought up in a family enjoying long-term success in real estate investment, Avrohom instead turned to the stock market. Nor is it necessary for the Court to decide whether New York or South Carolina law applies under South Carolina's choice of law principles. [Amended Complaint, 37, 40].
The company will explode Rich!" About Wellspring Capital Management Wellspring Capital Management is a leading private equity firm headquartered in New York. The complaint must provide more than mere "labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." The firm functions as a strategic rather than tactical partner, providing management teams with top-line support, M&A experience and financial expertise, and access to resources. Wellspring Capital Management is a leading private equity firm headquartered in New York. Revenue: $500 million to $1 billion (USD) Competitors: Unknown. And the best part of all, documents in their CrowdSourced Library are FREE. Environmental, Social and Governance (ESG), HVAC (Heating, Ventilation and Air-Conditioning), Machine Tools, Metalworking and Metallurgy, Aboriginal, First Nations & Native American. On December 31, 2018, the Borrowers defaulted on their obligations under the Loan Agreements and the Amendments. Prospect is a sophisticated party and, to the extent that it wanted to confirm the predictions made by Mr. Carles and Mr. Johnson were in fact accurate, it could have exercised due diligence. Investments Number of Investments 2 Wellspring Capital Management has made 2 investments. We believe that this breadth and depth of experience enables the team to efficiently evaluate and complete acquisition opportunities across a broad range of industries. "[F]or purposes of Rule 12(b)(6), '[the court is] not required to accept as true the legal conclusions set forth in a plaintiff's complaint.'" San Francisco Bay Area, Silicon Valley), Operating Status of Organization e.g. Investment Approach Target Investments Wellspring's objective is to acquire or invest in companies that are well-positioned to capitalize on change and can benefit from Wellspring's operating and financial expertise. Hiding negative complaints is only a Band-Aid. Less than a year later, the liquidation trustee sued Wellspring and related parties, alleging breaches of fiduciary duty of care and loyalty. Our tight-knit culture enables transparent oversight and a streamlined decision-making process. In Cyrus II, the court also acknowledged that the Fourth Circuit has found otherwise and determined that state choice of law rules should be used in bankruptcy cases. Lister v. NationsBank of Delaware, N.A., 329 S.C. 133, 143 (Ct. App. 544 and 550 and S.C. Code 27-23-10; (2) avoidance and recovery of fraudulent transfers by SportCo against the Transferee Defendants pursuant to 11 U.S.C. pursue new growth opportunities through strategic initiatives, operating improvements and add-on acquisitions. SaaS, Android, Cloud Computing, Medical Device), Where the organization is headquartered (e.g. Casetext, Inc. and Casetext are not a law firm and do not provide legal advice. Wellspring Capital Management is a middle-market private equity firm that has approximately $2 billion of private equity. Wellspring Capital Management is a leading middle-market private equity firm headquartered in New York. In re Merritt Dredging Co., Inc., 839 F.2d 203, 205 (4th Cir. Your livelihoodand your sanitydepend . Wellspring partners with highly qualified and motivated senior management teams, actively working together to unlock a companys potential by providing ongoing financial, strategic and operational support. It identifies undervalued companies whose share price does not properly reflect the true value of the business. The court must construe the allegations in the complaint in the light most favorable to the plaintiff. The assignment was executed in New York, but the personal property was located in South Carolina at the time the assignment was executed. 1984) for the proposition that under New York law, opinions are actionable in a negligence context. See Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir. D.S.C. at 382. UNITED STATES BANKRUPTCY COURT DISTRICT OF SOUTH CAROLINA. The adviser's REGISTRATION status is listed below. To summarize New York law, then, it appears that opinions can be actionable, but are not always actionable. Wellspring Capital Management Group LLC ("Wellspring"), a New York-based private equity firm, announced that on May 29, 2020, it closed the acquisition of Steele Solutions, Inc. ("SSI" or the "Company"), a value-add supplier into the industrial automation sector. As discussed in Cyrus II, the Fourth Circuit has stated that a bankruptcy court should apply the choice of law rules of the state in which it sits. 101 (32). Id. Haynsworth Sinkler Boyd, P.A. There are no allegations in the amended complaint that the debtors' liabilities exceeded their assets at the time of the transfers. Time to Read: 6 minutes
THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. The firms objective is to bring partnership, experience and value creation to each investment. Contribute to chinapedia/wikipedia.en development by creating an account on GitHub. at 385. The plaintiff responds that the statements relate to presently existing facts and that opinions are actionable in a negligence context. Id. 915 0 obj
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The elements of a negligent misrepresentation claim under South Carolina law are as follows: Turning now to the present case, the third cause of action must be dismissed under either New York or South Carolina law because the statements that the plaintiff asserts constituted negligent misrepresentations were all statements regarding potential outcomes of a potential business endeavor; thus, they relate to future events and cannot form the basis of a negligent misrepresentation claim. The United States District Court for the District of South Carolina found in a fraudulent conveyance case, relying on Terry v. Walker, that South Carolina conflict of law rules should apply to determine the applicable substantive law. 1985). The third cause of action asserts that those parties "made numerous representations to Prospect concerning the AcuSport Purchase, including that the purchase would allow the Debtors to acquire $14 million worth of AcuSport inventory at a substantial discount; that it would result in the Debtors' immediate realization of a $7 million profit on the sale of the AcuSport inventory so purchased; and that it would result in the Debtors' capturing 20% to 30% of AcuSport sales." This article about a private equity or venture capital firm based in the United States is a stub. The firm, which is based in New York City, was founded in 1995 by Martin Davis and Greg Feldman. 90], Alexander E. Carles [Docket No. In June 2019, SportCo and its subsidiaries (the "Debtors") filed chapter 11 bankruptcy cases in the United States Bankruptcy Court for the District of Delaware. to negotiate for release or indemnification, with the defendants arguing that such releases may have saved the post-restructuring company the expense of indemnifying the D&O Defendants in subsequent litigation. Jan. 25, 2016) (alteration original). Id. On March 7, 2013, the Borrowers entered into a First Amendment to the Loan Agreements (the "First Amendment"), pursuant to which Prospect loaned the Borrowers an additional $60 million. [Amended Complaint, 57]. Wellspring has one of the best track records in middle-market private equity; its people, capital and reputation bring certainty to transactions. Wellspring Capital Management, founded in 1995, is a middle-market private equity firm that has approximately $2 billion of private equity capital under management. 2020) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). It is not intended as and should not be construed as financial, investment, tax, legal, regulatory, or other advice. At all times relevant to these claims, Wellspring Capital controlled (a) Wellspring Capital Partners WELLSPRING CAPITAL MANAGEMENT ( CRD # 135455/SEC#:801-64341 ) WELLSPRING CAPITAL MANAGEMENT, WELLSPRING CAPITAL MANAGEMENT, INC. View latest Form ADV filed Part 2 Brochures. After the defendants filed replies, the Court held a hearing on June 18, 2020. In Sheldon, the defendant, a New York citizen, assigned some personal property to Mr. Dickinson. CDI's smaller Atlanta peer said to weigh sale in '18. 598, 614 (Bankr. With respect to which state's law applies, the defendants argue that the elements required to find that a party is a third party beneficiary are all met in this case and therefore New York law, as specified in the Loan Agreement's and Amendments' choice of law provisions, should apply to the plaintiff's causes of action against them. %PDF-1.5
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Adversary Proceeding No. California Weighs $360,000 in Reparations to Eligible Black Residents. Despite that agreement in principle, it was alleged in relevant part that: Unable to agree on the release and indemnification issue, SportCos out-of-court restructuring failed, and SportCo defaulted on its funded debt shortly thereafter. The plaintiff does not dispute that the amended complaint does not plead actual fraud, and it clearly does not. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. These emails can hardly be considered negligent misrepresentations. We look forward to carrying forward that vision and continuing our success in the years ahead.". Password (at least 8 characters required). From reading the Financial Times at school to managing his first portfolio at just 18, he has built Wellspring Capital into a nationwide wealth management boutique. . (Compl. Wellspring Capital Management LLC Chief Executive Officer Bill Dawson has taken a leave of absence, days after a former employee alleged in a lawsuit that he threatened her for accusing his son of sexual assault. Similarly, Merritt Dredging suggests that federal law would apply to a section 548 cause of action, but that state law should apply to fraudulent conveyance claims based on state law. Regardless, market participantsand equity sponsors in particularshould view Wellspring as an important reminder as to how both process and substance matter in restructuring negotiations. The amended complaint also details numerous emails sent by Mr. Carles and Mr. Johnson to a representative of Prospect, urging Prospect to defer its right to payment in the event of a default. Under either New York or South Carolina law, the plaintiff's third cause of action for negligent misrepresentation fails to state a claim for which relief can be granted. The Uniform Commercial Code defines insolvency as the inability to pay debts in the ordinary course or when they come due, while the Bankruptcy Code defines insolvency as debts exceeding assets. The elements of a negligent misrepresentation claim under New York law are: The plaintiff also cites King County, Washington v. IKB Deutsche Industriebank, 863 F. Supp. & Loan Ass'n of New York City, the plaintiff loaned funds to the defendant, secured by a mortgage on a parking garage. In connection with this contemplated purchase, Alexander Carles, a managing partner of Wellspring Capital and an officer and director of SportCo and its subsidiaries, and Bradley Johnson, the president and chief executive officer of SportCo and its subsidiaries, sought to convince Prospect to forbear from exercising any remedies in the event of a payment default. (quoting Bell Atl. The court addressed the dissent's finding, that the defendant's determination of the number of parking spaces was a matter of judgment or opinion and was therefore unactionable. v. Holmes (In re Holmes), 610 B.R. Importantly, however, the Wellspring court declined to dismiss the litigation trusts duty of loyalty claim, stating on a cursory basis that Drawing all inferences in favor of the Trustee, the Complaint contains sufficient allegations that the D&O Defendants breached their duty of loyalty regarding the Failed Out of Court Restructuring. Id. Sec'y of State for Def. Wellspring Capital Management. For the reasons set forth below, under the law of either state, the plaintiff's first and second causes of action must be dismissed. Use tab to navigate through the menu items. [Amended Complaint, 51]. We charge a minimal base fee and the rest is performance fees we generate for clients and not on the amount of capital clients allocate. NEW YORK, Jan. 10, 2018 /PRNewswire/ -- Wellspring Capital Management LLC ("Wellspring") today announced the successful closing of Wellspring Capital Partners VI L.P. ("Fund VI") with capital commitments totaling the hard cap of $1.415 billion. Additionally, the plaintiff argues that the third element of New York's third-party beneficiary test is not met because there is no express intent in the Loan Agreements or the Amendments to compensate the defendants in the event the distributions were not paid and in fact, the Loan Agreement indicates the opposite by virtue of the inurement clause found in Section 13.1. hXO8WtVH,~W"I/
{;N7'0HAA0%`Ih5L!p! Will Others Follow? Sav. D.S.C. Reputation Management. 2009). 2012) and West Side Fed. In support of this argument, the plaintiff cites a case from the United States District court for the District of Idaho, which was affirmed by the Ninth Circuit, as well as a case from the United States Bankruptcy Court for the Southern District of Texas, in which the court stated that 544(b) claims are unique "because they exist only to the extent of applicable state law," but then found, "Even so, such claims are not pendant state claims in federal bankruptcy cases, but are federal causes of action rooted in federal bankruptcy law and policy." (Bloomberg) -- Wellspring Capital Management LLC Chief Executive Officer Bill Dawson has taken a leave of absence, days after a former employee alleged in a lawsuit that he threatened her for accusing his son of sexual assault."We are taking this matter very seriously, and have launched an immediate internal investigation," Jeffrey Gould, Wellspring's head of marketing and investor . 112]. Defendant Wellspring Capital Management LLC is a Delaware limited liability company with its principal place of business at 390 Park Avenue, New York, New York 10022. 19.)1. Div. Wellspring CEO Bill Dawson is taking a leave of absence, the firm said Tuesday Last week a shocking lawsuit was filed against his son Christopher It claims he drugged and violently raped and. Wellspring Capital Management has acquired 38 organizations. Please Update this case to get latest docket information.
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