News & Analysis as of

Borrowers Fiduciary Duty

King & Spalding

Northern District of Texas Denies Summary Judgment to Lender on Fiduciary Duty Claim Based on Evidence of Excessive Control

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On February 6, 2024, the U.S. District Court for the Northern District of Texas, recognizing that a lender may assume a role of a fiduciary to a borrower in certain circumstances, denied a summary judgment motion by Wallis...more

Kilpatrick

The Hidden Risk for Lenders for Implied Fiduciary Duty

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Fiduciary duty may be implied in certain “special circumstances where a lender (i) takes on “extra services” for the borrower, (ii) receives greater economic benefit from a typical transaction; or (iii) exercises extensive...more

Lowenstein Sandler LLP

The SEC’s Private Fund Adviser Rules Explained — Part 1: The Restricted Activities Rule

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On August 23, 2023, the U.S. Securities and Exchange Commission (SEC) adopted new and amended rules under the Investment Advisers Act of 1940, as amended (the Advisers Act), to address what it perceives as certain conflicts...more

Goodwin

Second Circuit Rules that Syndicated Loans Are Not “Securities” Under State and Federal Law

Goodwin on

On August 24, 2023, the U.S. Court of Appeals for the Second Circuit in Kirschner unanimously  held that notes evidencing syndicated loans do not plausibly qualify as “securities” covered by state and federal securities laws...more

Robins Kaplan LLP

The Robins Kaplan Spotlight, Vol 8 No. 1 - Expecting the Unexpected: Navigating Fiduciary Relationships

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The Spotlight is the result of ongoing collaboration between our national trial practice and estate planning groups, with the goal of providing a forum to discuss the latest news and other issues impacting the trusts and...more

Robins Kaplan LLP

When Lending a Hand Results in Liability

Robins Kaplan LLP on

In a typical lender-borrower relationship, the lender owes the borrower no fiduciary duty. However, this general rule is set aside when the lender knowingly undertakes to act on behalf of and for the benefit of another. Such...more

Hudson Cook, LLP

California Senator Introduces Bill to Make Commercial Brokers Fiduciaries of Borrowers

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Last month, California Senator Steve Glazer introduced a bill that could fundamentally change commercial finance brokering in the state. Senate bill 869 would expand the licensing requirement for brokers of commercial loans...more

Foley & Lardner LLP

SBA Change of Control Guidance Does Not Work for Insolvent PPP Borrowers

Foley & Lardner LLP on

This article focuses on the recent “change of control” guidance issued by the SBA to its PPP lenders (the “Guidance”) and, more specifically, how that Guidance affects insolvent PPP borrowers when they need to sell assets. As...more

Goodwin

ISS Publishes 2021 Proxy Voting Guidelines

Goodwin on

In the News. Institutional Shareholder Services (ISS) published its proxy voting guidelines updates for 2021, which include new and updated voting recommendations on federal forum and exclusive forum provisions in companies’...more

Pierce Atwood LLP

Developments in Class Action Litigation Surrounding the Paycheck Protection Program

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As more class actions are filed every day related to the COVID-19 pandemic, a growing number of plaintiffs are asserting claims against banks that acted as participating lenders in the Paycheck Protection Program (PPP). The...more

Winstead PC

Attorney For Lender Did Not Owe Any Fiduciary Duties To Borrower As An Escrow Agent

Winstead PC on

In JTREO, Inc. v. Hightower & Assocs., the buyer of a note and mortgage sued the attorney for the lender who facilitated the transaction by loaning money to the buyer for breach of fiduciary duty arising from the fact that...more

Bowditch & Dewey

Lender Liability During COVID-19

Bowditch & Dewey on

During an interview with Bloomberg TV on March 6th, Lawrence Summers, former Secretary of the U.S. Treasury, observed: “Economic time has stopped but financial time has not stopped.” An incisive summary as any of the current...more

Carlton Fields

Real Property, Financial Services, & Title Insurance Update: Week Ending February 7, 2020

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Real Property Update - Fraudulent Transfer: Real property that was worth less than mortgage encumbering it was not an asset per the plain language of section 726.102(2) and, therefore, could not support fraudulent transfer...more

Jones Day

Fifth Circuit Rules That Corporate Charter Provision Requiring Shareholder Consent for Bankruptcy Filing Is Enforceable but...

Jones Day on

In a highly anticipated decision, the U.S. Court of Appeals for the Fifth Circuit recently affirmed a bankruptcy court order dismissing a chapter 11 case filed by a corporation without obtaining—as required by its corporate...more

Snell & Wilmer

Avoiding Lender Liability for Credit-Related Actions in California

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Aside from general statutory prohibitions on lender discrimination, there are certain circumstances under California law in which lenders may be held liable for credit-related actions, such as negotiating or denying credit....more

Carlton Fields

Real Property, Financial Services & Title Insurance Update: Weeks Ending July 31 & August 7, 2015

Carlton Fields on

Foreclosure: non-borrower owner of real property as tenants-in-common with borrower not required to sign mortgage for borrower to encumber only his interest in the property and non-borrower’s signature on mortgage reflected...more

Womble Bond Dickinson

NC Supreme Court Reminds Court of Appeals That Typical Lender-Borrower Relationship is Not a Fiduciary One

Womble Bond Dickinson on

The North Carolina Supreme Court recently reaffirmed that a run-of-the-mill lender and borrower are not fiduciaries, reversing the Court of Appeals decision that would have this issue to go to the jury. The case is Dallaire...more

Baker Donelson

"I Knew You Were Trouble": Recent Trends in Lender Liability Litigation

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Lender liability claims generally arise in one of following contexts: (i) claims seeking recovery of damage or "leverage" to accept discounted payoffs; (ii) counterclaims to foreclosure/receivership/guarantor actions; or...more

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