wellspring capital management lawsuitwellspring capital management lawsuit

The portfolio manager is also a co-investor in the strategy. Password (at least 8 characters required). A constructive fraudulent conveyance exists under New York law if the conveyance was made without fair consideration and "(1) the transferor is insolvent or will be rendered insolvent by the transfer in question; (2) the transferor is engaged in or is about to engage in a business transaction for which its remaining property constitutes unreasonably small capital; or (3) the transferor believes that it will incur debt beyond its ability to pay." In 2008, Wellspring Capital, through its fund Wellspring Capital Partners, acquired Ellett. 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. The firms objective is to bring partnership, experience and value creation to each investment. The courts analysis of the duty of loyalty claim can be fairly characterized as limited, consisting of four short paragraphs that largely restate or simply quote the complaint. [4] Wellspring completed fundraising on its sixth fund in 2018 with $1.45 billion of investor commitments as a successor to its $1.2 billion 2011 Fund V.[3], Wellspring focuses on the packaging, healthcare, niche manufacturing and distribution sectors.[5][6]. In considering whether to grant a motion to dismiss under Rule 12(b)(6), the court may take judicial notice of matters of public record and may consider documents attached to the complaint and the motion to dismiss, "so long as they are integral to the complaint and authentic." Type: Company - Private. Hiding negative complaints is only a Band-Aid. 915 0 obj <> endobj By continuing to use this website, you agree to UniCourts General Disclaimer, Terms of Service, It identifies undervalued companies whose share price does not properly reflect the true value of the business. Already a subscriber? Div. EFFECTIVE DATE; SEC: Terminated: 3/2/2007: They are not actionable. Most of them do not even contain any concrete information about the proposed AcuSport purchase or the likelihood of the Borrowers' default. Therefore, the plaintiff argues that he is only required to establish constructive fraud. You can help Wikipedia by expanding it. UniCourt uses cookies to improve your online experience, for more information please see our Privacy Policy. 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. Wellspring, 2021 WL 4823513, at *10. The first and second causes of action are dismissed. Asia Pacific; EMEA; Latin America; UK Solicitors; UK Bar; United States In June 2017, Gymboree announced it was filing for Chapter 11 bankruptcy protection. 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." In April 2018, Prospect agreed to defer two quarters of cash interest payments. We look forward to carrying forward that vision and continuing our success in the years ahead.". & Loan Ass'n v. Hirschfeld, 476 N.Y.S.2d 292 (N.Y. App. The amended complaint further states, "As recently as 2015, Ellett was the fifth largest private company in South Carolina and the largest distributor of firearms in the United States, with annual revenues of $750 million, over 350 employees nationwide, and 175 employees in South Carolina." [Amended Complaint, 32]. 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. e""8*&B Because the Court dismisses the complaint as to all other defendants, the Court sua sponte dismisses the causes of action against Mr. Ziomek as well. They are simply not statements of preexisting fact that were false when made. 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. "[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.'" Section 544(b) states: The defendants' motions assert numerous arguments in support of the assertion that the Court must dismiss the plaintiff's causes of action. [Amended Complaint, 49]. The 2011 Wellspring Capital Partners V LP was fully invested at $1.2 billion and has generated positive returns for its investors to-date. Fed. SportCo later filed a free fall bankruptcy and liquidatedallegedly causing substantial losses for unsecured creditors that would not have occurred had SportCo accepted that agreement in principle allegedly reached in December 2018. The court stated: See Credit Alliance Corp. v. Arthur Anderson & Co., 65 N.Y.2d 536 (NY App. Wellspring Capital Management, founded in 1995, is a middle-market private equity firm that has approximately $2 billion of private equity capital under management. An outside law firm will assist with the probe to determine the validity of these reports, which allege behavior that is not only shocking but completely inconsistent with our corporate values and standards., Family calls complaint pure fiction intended as a shakedown, Dawson steps away from firm to spend time with his family. [Amended Complaint, 93]. %PDF-1.5 % 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. Menu Home; Rankings. After the defendants filed replies, the Court held a hearing on June 18, 2020. endstream endobj startxref "To survive a motion to dismiss, 'a complaint must contain sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face."'" At all times relevant to these claims, Wellspring Capital controlled (a) Wellspring Capital Partners 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. Wellspring Capital Management is an American private equity firm focused on leveraged buyout investments in middle-market companies across a range of industries. 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. The plaintiff responds that the express terms of the choice of law provisions provide that the clause applies only to the parties to the Loan Agreements and the Amendments and that the defendants' indirect connection to the parties to the agreements, and the nature of their received benefit, a distribution, are not sufficient to render them third-party beneficiaries of the Loan Agreements and the Amendments. The firm prefers to invest in the business services, industrial, packaging, healthcare services, restaurants . Tex. 2016) (citing numerous cases, recognizing disagreement among courts regarding whether fraudulent conveyance action is a tort action); MainStreet Bank v. Nat'l Excavating Corp., 791 F. Supp. at 358. The defendants argue that in the event the Court finds the choice of law provision does not apply, South Carolina choice of law principles should be consulted to reach a finding that New York law applies. January 12, 2022 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." Use tab to navigate through the menu items. This article about a private equity or venture capital firm based in the United States is a stub. 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. The defendant represented to the plaintiff, and to an appraiser who performed an appraisal of the garage, that the parking garage had 500 parking spaces. Wellspring Capital Management is an American private equity firm focused on leveraged buyout investments in middle-market companies across a range of industries. There are also no allegations concerning expenses. Wellspring Capital manages an investment portfolio of between 10 and 15 international stocks. Wellspring has one of the best track records in middle-market private equity; its people, capital and reputation bring certainty to transactions. They were not statements of presently existing fact. Wellspring Capital is a boutique discretionary management service with a portfolio positioned for high performance. Law360 may contact you in your professional capacity with information about our other products, services and events that we believe may be of interest.Youll be able to update your communication preferences via the unsubscribe link provided within our communications.We take your privacy seriously. The defendants' remaining arguments need not be addressed. A finding that Prospect is a preexisting creditor compels the same result. with actual intent . Fund VI brings the firm's assets under management to more . 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). Brought up in a family enjoying long-term success in real estate investment, Avrohom instead turned to the stock market. You can review interesting Flipbooks on my site. SportCos negotiations were led by a SportCo director, who was also the managing partner of Wellspring Capital, SportCos equity sponsor. GitHub export from English Wikipedia. Jan. 25, 2016) (alteration original). Tow v. Rafizadeh (In re Cyrus II P'ship), 413 B.R. 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. Contact:KekstMark Semer or Peter Hill212.521.4800, Cision Distribution 888-776-0942 Wellspring Capital Management is a middle-market private equity financing firm. App'x 143 (4th Cir. A former employee of Wellspring Capital Management filed a lawsuit in a New York Thursday alleging that the CEO's son, Christopher Dawson, drugged and repeatedly raped her one night in the. Private equity firm Wellspring Capital Management has acquired Caring Brands International, parent company of home health and hospice franchise company Interim Healthcare, for an undisclosed amount. Amazon Pauses Construction on Second Headquarters in Virginia as It Cuts Jobs, Amazon Is Closing Its Cashierless Stores in NYC, San Francisco and Seattle, iPhone Maker Plans $700 Million India Plant in Shift From China, Stock Traders Are Ignoring Blaring Bond Alarms, S&P 500 Notches Best Week Since Late January: Markets Wrap. The. PLEASE NOTE: A verification email will be sent to your address before you can access your trial. . In Wellspring, the Delaware bankruptcy court held that an alleged duty of loyalty breach could survive a motion to dismiss where: Bear in mind that alleged is the operative word here. The Debtors in the bankruptcy cases, pending in the District of Delaware, are SportCo Holdings, Inc.; Ellett Brothers, LLC; United Sporting Company, Inc.; Bonitz Brothers, Inc.; Evans Sports, Inc.; Jerry's Sports, Inc.; Outdoor Sports Headquarters, Inc.; Quality Boxes, Inc.; and Simmons Guns Specialties, Inc. 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. Innovative Custom Brands, Inc. v. Minor, 2016 WL 308805, at *2 (S.D.N.Y. 962 0 obj <>stream Ronald J. Friedman, as the trustee for the SportCo Creditors' Liquidation Trust, Plaintiff, v. Wellspring Capital Management, LLC, Wellspring Capital Partners IV, L.P., WCM Genpar IV, L.P., WCM Genpar IV GP, LLC, Alexander E. Carles, Bradley Johnson, F. Hewitt Grant, Charles E. Walker, Jr., Todd Boehly, Bernard Ziomek, and Andrew Kupchik, Defendants. Wellspring Capital Management LLC operates as a private equity firm. [Amended Complaint, 31]. The Court does not have to decide whether Prospect is a preexisting or a subsequent creditor. Since its founding in 1995, Wellspring has raised over $4 billion of initial capital commitments through six private equity funds. Consumers want to see how a business took care of business. The Firm takes pride in its ability to marshal its resources quickly and focus on the issues that matter, resulting in speed and certainty during the acquisition process. The firm, which is based in New York City, was founded in 1995 by Martin Davis and Greg Feldman. 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. Ellett used $54,860,549.74 of the First Amendment loan proceeds to fund distributions to the Transferee Defendants. 23, 2006) (stating that some courts characterize fraudulent conveyance actions as tort actions, while others characterize them as matters in equity). The court considered whether inaccurate credit ratings can form the basis for a negligent misrepresentation claim. Read More Key Principal: William Dawson Junior See more contacts Industry: Management investment, open-end Printer Friendly View Address: 605 3RD Ave FL 44 New York, NY, 10158-0011 United States See other locations Phone: Website: www.wellspringcapital.com Employees (this site): Actual The firm, which is based in New York City, was founded in 1995 by Martin Davis and Greg Feldman. "); Terry v. Walker, 2006 WL 736861, at *5 (W.D. The Wellspring court dismissed the litigation trusts claim for breach of the fiduciary duty of care, holding that it was not adequately pled. Id. Public Records Policy. 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. We see how Bembury is able to walk the line of business convention while taking his art to new heights, turning ordinary items into extraordinary footwear. The Court now issues this order, granting the motions to dismiss for the reasons set forth below. 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. Musk Made a Mess at Twitter. Lister v. NationsBank of Delaware, N.A., 329 S.C. 133, 143 (Ct. App. 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. Over the past 20 years, Wellspring has invested in over 35 platform investments across . If you do not agree with these terms, then do not use our website and/or services. The plaintiff's first and second causes of action are based on 11 U.S.C. On 05/20/2022 Wellspring Capital Management, LLC Wellspring Cap filed an Other lawsuit against Barry, III.This case was filed in U.S. Bankruptcy Courts, New York Southern Bankruptcy. @S1 $82N+ZJ | Ellett achieved high sales and revenues and had significant operations until sometime in 2016, when its profits began to decrease. Jan. 30, 2023). Certain state securities regulatory authorities have similar exemptions based on . Their most recent acquisition was Caring Brands International on Oct 25, 2021. The Company specializes in private companies buyouts, acquisitions of divisions and subsidiaries of public companies, and going . Wellspring Capital Management is a leading private equity firm headquartered in New York. In considering what choice of law provisions to apply, the Fourth Circuit stated: The Court notes that there is a specific fraudulent conveyance section of the Bankruptcy Code. 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. Reputation Management. Wellspring Capital Management, LLC; Wellspring Cap. 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. The basic complaint is that Wellspring directors put self-interests above those of the company and its creditors. The court must construe the allegations in the complaint in the light most favorable to the plaintiff. The amended complaint further states that from October 2012 to October 2013, "Ellett achieved record sales and earned revenues of approximately $1.2 billion." The parties are in agreement that New York and South Carolina law regarding negligent misrepresentations are substantially similar and that as a result, the Court is not required to engage in a choice of law analysis as to the third cause of action. 90], Alexander E. Carles [Docket No. The principal and lead portfolio manager at Wellspring Capital is Avrohom Neumann. These tools have been used since the firm's inception in 1995 to generate consistent business improvement in its portfolios. 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. endstream endobj 916 0 obj <>/Metadata 258 0 R/Pages 913 0 R/StructTreeRoot 384 0 R/Type/Catalog>> endobj 917 0 obj <>/MediaBox[0 0 612 792]/Parent 913 0 R/Resources<>/Font<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI]>>/Rotate 0/StructParents 0/Tabs/S/Type/Page>> endobj 918 0 obj <>stream 2022 Wellspring Capital Management Group LLC |. 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. Particularly where negotiations may involve releases, indemnification, or similar provisions, be advised that the ever-present tendency for counterparties to exercise 20/20 hindsight is fully in effect. This preference is a result of the Firms differentiated and conservative approach to leverage, in addition to a transparent oversight model, which is driven by our small group of senior professionals and absence of bureaucracy. 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 . Id. Wellspring Capital, through defendants Mr. Carles and Mr. Johnson, allegedly represented to Prospect that: (1) Ellett could purchase assets of AcuSport for $14.8 million; (2) the purchase would result in the Debtors' capturing 20% to 30% of AcuSport sales; (3) the Debtors could acquire $14 million of AcuSport inventory at a substantial discount; and (4) Ellett would immediately realize a $7 million profit on the sale of the inventory acquired in the purchase. In Ashmore for Wilson, the District Court considered the question of how a fraudulent conveyance claim should be characterized for conflict of law purposes. There are no allegations in the amended complaint that the debtors' liabilities exceeded their assets at the time of the transfers. Wellspring Capital Management Fund Manager Website www.wellspringcapital.com Fund Category Private Equity Close Date 0000-00-00 Fund Family Wellspring Capital Partners Native Currency USD Fund Manager's Location 605 Third Avenue 44th Floor New York, NY 10158 United States +1 (212) 000-0000 Fund Domiciles Canada Id. Wellspring Capital Management is a leading middle-market private equity firm headquartered in New York. While property interests are defined by state law in the absence of a compelling federal interest, the Court would look to the Bankruptcy Code in making a determination of whether property is property of the estate under section 541. 2100 Geng Road, Suite 210 Palo Alto, CA 94303. Wellspring Capital Management is an American private equity firm focused on leveraged buyout investments in middle-market companies across a range of industries. When typing in this field, a list of search results will appear and be automatically updated as you type. The firm, which is based in New York City, was founded in 1995 by Martin Davis and Greg Feldman. Sec'y of State for Def. We work with successful motivated individuals to help them achieve their investment and wealth management objectives. The seller, PE outfit Levine Leichtman Capital Partners, purchased the company in 2015. Designed By, https://www.wellspringcapital.co.uk/disclaimer. Id. v. Holmes (In re Holmes), 610 B.R. The firm's objective is to bring partnership, experience and value creation to each investment. 2d 520, 529 n.14 (E.D. Instead, they may form the basis for a negligent misrepresentation claim if the party making the misrepresentation possesses some special expertise (by way of his job title or position, for example), or has some special knowledge about the particular fact that is allegedly misrepresented.
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