wellspring capital management lawsuit

wellspring capital management lawsuitwellspring capital management lawsuit

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. Federal Rule of Bankruptcy Procedure 7012(b). Wellspring Capital Management is a leading middle-market private equity firm headquartered in New York. Environmental, Social and Governance (ESG), HVAC (Heating, Ventilation and Air-Conditioning), Machine Tools, Metalworking and Metallurgy, Aboriginal, First Nations & Native American. P. 12(b)(6). After all, corporate decisionmakers are often tasked with choosing a path where outcomes are at best uncertain. Investment Philosophy; Target Investments; Portfolio Business Restructuring, EFFECTIVE DATE; SEC: Terminated: 3/2/2007: Since its founding in 1995, Wellspring has raised over $4.5 billion of initial capital commitments through six private equity funds. 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 is not intended as and should not be construed as financial, investment, tax, legal, regulatory, or other advice. 90], Alexander E. Carles [Docket No. 2100 Geng Road, Suite 210 Palo Alto, CA 94303. Practices: Full title:Ronald J. Friedman, as the trustee for the SportCo Creditors' Liquidation, Court:UNITED STATES BANKRUPTCY COURT DISTRICT OF SOUTH CAROLINA. Wellspring Capital Management is a leading private equity firm headquartered in New York. 2005)). January 12, 2022 By teaming up with strong management, Wellspring is able to unlock underlying value and pursue new growth opportunities through strategic initiatives, operating improvements and add-on acquisitions. For example, the October 27, 2017 email stated, "The only way to optimize is to merge with Acusport." UniCourt uses cookies to improve your online experience, for more information please see our Privacy Policy. Wellspring Capital Management is an American private equity firm focused on leveraged buyout investments in middle-market companies across a range of industries. Hiding negative complaints is only a Band-Aid. at 613-14. It is not unusual for an entity facing distress to engage with their stakeholders and to negotiate any number of transaction alternatives and terms. Attorney advertising. The firm's objective is to . As with the plaintiffs assertions around disinterested governance, such allegations may (or may not) bear any semblance to the actual facts. 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. My company, Asia Marketing and Management, has global ambitions but consists largely of me and the intelligence, experience, contacts, and per-sonality I bring to my clients . 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. SportCos negotiations were led by a SportCo director, who was also the managing partner of Wellspring Capital, SportCos equity sponsor. In Wellsprings view, the extent to which releases might have benefitted SportCo (as opposed to benefiting the directors alone) was at least in part a question of fact that could not be resolved on a motion to dismiss. Sec'y of State for Def. About Wellspring Capital Management Wellspring Capital Management, founded in 1995, is a leading middle-market private equity firm that manages more than $4.4 billion of private equity capital. Wellspring also rejected in cursory fashion the defendants argument that it is not necessarily a breach . Twitter Revenue, Earnings Fell About 40% in December, WSJ Says, John Malone andCharter Directors Agree to $87.5 Million Settlement, China E-Commerce Giant JD Set for $1.4 Billion Discount Spree, Between Rounds of Golf, Trumps Searching for the Perfect DeSantis Diss, Your Saturday UK Briefing: Sunak Chalks Up a Win as the Budget Looms, Harrods Shrugs Off Recession Fears as Rich Get Richer, FT Says, Wealthy NYC Family Feuds Over $258 Million Madison Avenue Sale, Tom Sizemore, 'Saving Private Ryan' Actor, Dies at 61, The Exhibit Reality TV Show PittingArtist Against ArtistIs No Masterpiece. Copyright 2023 Ropes & Gray LLP. PLEASE SEE THIS LINK FOR FULL DISCLAIMER: https://www.wellspringcapital.co.uk/disclaimer. 91], Andrew Kupchik [Docket No. Wellspring Capital Management is a leading private equity firm headquartered in New York. The legal team representing former President Donald Trump formally has requested a six-month delay in the civil case filed against him by New York Attorney General Letitia James. [Amended Complaint, 49]. Wellspring, 2021 WL 4823513, at *10. The amended complaint contains no allegations that either Ellett, with respect to the first cause of action, or SportCo, with respect to the second cause of action, was insolvent at the time of the distributions or became, at the time of the transfers, insolvent as a result of the transfers. Limited partners include leading pension funds, endowments, fund of funds and family offices from the U.S., Europe and Asia. Accordingly, SportCo began negotiations with certain of its lenders around a potential restructuring transaction. Casetext, Inc. and Casetext are not a law firm and do not provide legal advice. Tow v. Rafizadeh (In re Cyrus II P'ship), 413 B.R. Revenue: $500 million to $1 billion (USD) Competitors: Unknown. A social media content creator signed an agreement with Birchbox in May of 2022 and hadn't been paid the $2,500 due as of Jan. 24, despite several emails to the company. Accordingly, Wellspring reinforces the importance of disinterested governance and arms length dealing in connection with the restructuring process. 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. 2022 Wellspring Capital Management Group LLC |. In early 2018, Wellspring Capital notified SportCo's secured lenders that SportCo would default on a $4.7 million interest payment due in the second quarter of 2018. Further, if the statement is solely a speculative prediction about some potential business venture or course of action being contemplated, it is not actionable. New York law prohibits both actual and constructive fraudulent conveyances. 0 . Wellspring Capital Management. In 2012, the year that the amended complaint alleges Ellett "achieved record sales and earned revenues of approximately $1.2 billion," Ellett and its operating subsidiaries (the "Borrowers") entered into a Third Amended and Restated Loan and Security Agreement and a Second Lien Loan and Security Agreement (collectively, the "Loan Agreements") with lenders including Prospect Capital Corporation ("Prospect"), pursuant to which Prospect and the other lenders loaned $280 million to the Borrowers. Over $134 million of the loan proceeds were used to fund distributions to Wellspring Capital Partners, WCM GenPar IV, L.P., WCM GenPar IV GP, LLC, F. Hewitt Grant, Charles E. Walker, Jr., Todd Boehly, Bernard Ziomek, and Andrew Kupchik (collectively, the "Transferee Defendants"). These all relate to a proposed business transactionthe purchase by Ellett of AcuSport. The District Court in Ashmore for Wilson stated: The parties' arguments regarding what law applies to the plaintiff's fraudulent conveyance claims present some complicated and novel questions; however, it is not necessary for the Court to decide whether the defendants are third party beneficiaries of the Loan Agreements or the Amendments. See Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir. These emails may be a lot of things, but negligent misrepresentations they are not. The Firm also has a long history of collaboration with entrepreneurs and closely held businesses to achieve outsized growth, with a large percentage of our portfolio companies being transitioned from founder ownership. Id. 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. On December 31, 2018, the Borrowers defaulted on their obligations under the Loan Agreements and the Amendments. 91], F. Hewitt Grant [Docket No. I Shall [Not] Be Released: Wellspring, Director Releases, breached their duty of care, since the directors refused to reasonably maximize corporate value by killing the restructuring on account of releases/indemnity (, breached their duty of loyalty, since they placed their own self-interests above those of their fiduciaries [. Shoe designer and creative Salehe Bembury takes us on a journey from his childhood growing up in Manhattan, to an invaluable degree in industrial design, to working with some of the biggest names in fashionbefore breaking off to make his own name. Id. This article about a private equity or venture capital firm based in the United States is a stub. It is not intended as and should not be construed as financial, investment, tax, legal, regulatory, or other advice. 1994)). In re Merritt Dredging Co., Inc., 839 F.2d 203, 205 (4th Cir. We are motivated and incentivised to succeed. David R. Duncan US Bankruptcy Judge District of South Carolina. 2008) (citing Southmark Corp. v. Crescent Heights VI, Inc. (In re Southmark Corp.), 95 F.3d 53, 53, n.7 (5th Cir. (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 . The first and second causes of action are dismissed. 930 0 obj <>/Filter/FlateDecode/ID[<6781EE974E7B2C4D9274E8F359D28E60>]/Index[915 48]/Info 914 0 R/Length 80/Prev 600062/Root 916 0 R/Size 963/Type/XRef/W[1 2 1]>>stream Broker-Dealers Business & Commercial Litigation Business Restructuring California Consumer Privacy Act Capital Markets Capital Solutions & Private Credit Charitable Foundations China Life Sciences Committee on Foreign Investment in the United States (CFIUS) Consumer Protection and Advertising Law Corporate & Securities Litigation PLEASE SEE THIS LINK FOR FULL DISCLAIMER: This site is for informational purposes only. 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. (quoting Bell Atl. The firm prefers to invest through means of carveout, buyouts, add-on, public to private and growth capital. Litigation. 915 0 obj <> endobj Wellspring Capital Management is a leading private equity firm headquartered in New York. Wellspring has the flexibility to complete transactions ranging from $100 million to as much as $1.5 billion in total value in a wide range of industries. Our returning and new limited partners share our belief in the unique value proposition that Wellspring brings to the investment process, with our focus on strategic partnership and tailored approach to each investment. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. New York law regarding third party beneficiaries provides: With respect to South Carolina's choice of law analysis, South Carolina conflict of law principles provide that "the substantive law governing a tort action is determined by the state in which the injury occurred." 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. 24. The Court now issues this order, granting the motions to dismiss for the reasons set forth below. This matter is before the Court on motions to dismiss filed by the defendants Wellspring Capital Management, LLC ("Wellspring Capital"), Wellspring Capital Partners IV, L.P. ("Wellspring Capital Partners"), WCM Genpar IV, L.P., WCM Genpar IV GP, LLC (collectively, the "Wellspring Defendants") [Docket No. 2021 by wellspring capital Management. Already a subscriber? Wellspring Capital Management, founded in 1995, is a leading middle-market private equity firm that manages more than $3 billion of private equity capital. Consumers want to see how a business took care of business. [cV3ljHkT/bx @A,20p1 ks WELLSPRING CAPITAL MANAGEMENT, founded in 1995, is a middle-market private equity firm that has approximately $2 billion of private equity capital under management. These emails can hardly be considered negligent misrepresentations. The Court does not have to decide whether Prospect is a preexisting or a subsequent creditor. Wellspring Capital Management is a leading middle-market private equity firm headquartered in New York. In fact, the amended complaint states that the distributions at issue here were made in October 2012 and March 2013. Wellspring, founded in 1995, has raised more than $4 billion of capital commitments through six private equity funds, according to its website. Lister v. NationsBank of Delaware, N.A., 329 S.C. 133, 143 (Ct. App. In 2010, Bain Capital acquired the company for US$1.8 billion. 89], Charles E. Walker, Jr. [Docket No. Ellett achieved high sales and revenues and had significant operations until sometime in 2016, when its profits began to decrease. The plaintiff relies on the fact that Ellett was unable to pay the debt owed to Prospect at the time that it had to be paid in full; however, this is not the only relevant point in time. The defendants argue that New York law should apply, first, because the Loan Agreements and the First and Second Amendments contain choice of law provisions stating that New York law will apply and second, because South Carolina choice of law analysis dictates that New York law should apply. Sav. Even among California Democrats, Newsom is still in the negatives, with 54% wanting him to sit out in 2024 and only 35% wanting him to run. GitHub export from English Wikipedia. Wellspring targets investments with the following characteristics: The amended complaint does not allege that either Ellett or SportCo was insolvent at the time of the transfer or became insolvent as a result of the transfer. In Fall 2018, SportCo Holdings, Inc. (SportCo) was facing severe financial distress. The defendants' motions to dismiss are granted. The Company specializes in private companies buyouts, acquisitions of divisions and subsidiaries of public companies, and going . As part of the debt management process, it said it would close 375 of its 1,300 stores. Certain state securities regulatory authorities have similar exemptions based on . 2d 520, 529 n.14 (E.D. 2018) (distinguishing cases where the courts dismissed negligent misrepresentation claims based on "puffery" or founded solely on speculative statements regarding future profits as a result of proposed transactions, and finding that the misrepresentations at issue were actionable because they involved present facts). Otherwise you cannot get paid." Posted By: Imright , 3/3/2023 9:31:52 PM. Note: This site is for informational purposes only. It had previously received notification, in early 2018, that the Borrowers would default on their obligation under the Loan Agreements and the Amendments in the second quarter of 2018. The court stated that expressions of opinion are actionable under New York law, but further stated: New York courts have also stated that statements of "mere puffery", or "statements founded entirely on speculation concerning future profits from proposed business endeavors" are not actionable. The Court also notes that, setting the other factors aside, given the extreme nature of the urgent tone of these emails, and the highly sophisticated status of Prospect, Prospect satisfying the justifiable reliance element of a negligent misrepresentation claim is questionable, at best. 2009). Law360 provides the intelligence you need to remain an expert and beat the competition. Mr. Friedman was substituted as the plaintiff on January 10, 2020. 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. Innovative Custom Brands, Inc. v. Minor, 2016 WL 308805, at *2 (S.D.N.Y. Cancellation and Refund Policy, Privacy Policy, and By Zachary Zagger (July 31, 2020, 9:56 PM EDT) -- Private equity firm Wellspring Capital Management LLC on Friday hit a slew of its insurers with a suit in New York state court alleging they must defend it against claims that it plundered millions of dollars from gun seller United Sporting Cos. Inc., which blamed its bankruptcy on Donald Trump's win in the 2016 election. Access to case data within articles (numbers, filings, courts, nature of suit, and more. 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. Our tight-knit culture enables transparent oversight and a streamlined decision-making process. Id. James brought a civil suit against Trump in September, alleging the Trump organization had fraudulently inflated the value of . 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. The firm's objective is to bring partnership, experience and value creation to each investment. Find More Contacts for Wellspring Capital Management, Edit Lists Featuring This Company Section, European Regulation Ushers In Global Future For Fundraising, Wellspring Capital Management Acquires Caring Brands International, Private Equity Firms with Investments in United States, Greater New York Area Investors with Funds Raised in 2017, Private Equity Firms with Investments in Asia. 1991) (unpublished table decision). Headquarters Location Lever House 390 Park Avenue New York, New York, 10022, United States Over the past 20 years, Wellspring has invested in over 35 platform investments across . The portfolio manager is also a co-investor in the strategy. The origins of Wellspring Philanthropic Fund are shrouded. Their most recent investment was on Jan 1, 2020, when Steele Solutions raised The defendants filed separate motions. Asia Pacific; EMEA; Latin America; UK Solicitors; UK Bar; United States Wellspring Capital is a boutique discretionary management service - with a portfolio positioned for high performance. with actual intent . v. Holmes (In re Holmes), 610 B.R. Id. York Capital Management Feb 2021 - Present2 years 1 month New York, New York, United States Wellspring Capital Management LLC 13 years 5 months Partner Dec 2016 - Dec 20204 years 1 month. Id. Cases involving other matters not classified elsewhere, 890, 1890, 1990, 2890, 2899, 2999, 3375, 3890, 3896, 3899, 3999, 4890, 4896, 4999, Wellspring Capital Management, LLC; Wellspring Cap v. Barry, III et al. The adviser's REGISTRATION status is listed below. 93], and Bradley Johnson [Docket No. The amended complaint fails to allege insolvency at the time of the transfer, an essential element of a fraudulent conveyance claim under either New York or South Carolina law, and therefore fails to state a claim under 544(b). Wellspring Capital Management is a leading private equity firm headquartered in New York.

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