FCA Implications for M&A Transactions
Polsinelli Podcasts - Supreme Court Closes Gap on Bankruptcy Issue
A requirement of proving a fraudulent conveyance occurred is establishing that the conveyance was fraudulently intended. Courts in British Columbia will rely on the presence of ‘badges of fraud’, such as whether the...more
Business owners often use a strategy to protect their assets from potential creditors seeking to realize on their debts. To protect themselves, business owners can transfer ownership of property to family members or create...more
No corporate lawyer wants to get drawn into a nasty litigation between an entity’s owners. But the reality is that corporate and general counsel often find themselves unwittingly ensnared in business divorce cases. Sometimes...more
The Ontario Fraudulent Conveyances Act (the FCA), a concise statute of long-standing that traces its history to an English statute of 1571, is intended to prevent conveyances of property made with the intent to defeat,...more
Disputes over allegedly fraudulent conveyances have become more common in bankruptcy cases. Fraudulent transfer allegations are also common in transactions such as leveraged buy-outs and recapitalizations. Analysts are...more
In mergers and acquisitions, the False Claims Act is an important consideration that both buyers and sellers need to address, particularly if the target company is the focus of an FCA investigation. It’s also important for...more
A recent decision by Delaware Bankruptcy Judge John Dorsey will limit the ability of bankruptcy trustees to expand the lookback period for avoiding pre-bankruptcy transfers beyond the four years provided under most state law...more
One of the fundamental principles of corporate law is that the owners, directors and officers of a corporate entity generally are not personally responsible for the entity’s debts. Without this insulation from personal...more
What can you do when the parties you are suing are effectively judgment-proof? Oftentimes, plaintiffs will try to go after a defendant’s family member or related entity. ...more
Appearances can be deceiving. - That, essentially, was the argument made in two recently decided cases involving claims for judicial dissolution. ...more
The Superior Court issued a non precedential decision on September 21 grappling with a question that has lingered since Pennsylvania adopted equitable distribution forty years ago. What happens to transfers of marital assets...more
The outcome of litigation often depends on which party has the burden of presenting evidence to support its claim (the “Burden of Production”) and persuading the judge or jury that it has a viable claim (the “Burden of...more
Recently, the CFPB and New York Attorney General filed a complaint against Douglas MacKinnon and members of his immediate family to unwind the allegedly fraudulent conveyance of MacKinnon’s $1.6 million home made shortly...more
In a March 9, 2021 opinion, the Maryland Court of Appeals signaled the end of what it termed “an elaborate web of procedural history” by answering two questions certified to it by the United States District Court for the...more
Oral agreements to form and operate business enterprises are a recurring subject of this blog. We’ve written many times, for example, about the comparative ease vis-a-vis other kinds of entities with which one can...more
In early December, the United States District Court for the Southern District of New York denied, in part, a motion to dismiss claims of breach of fiduciary duty and recovery of fraudulent conveyances brought against former...more
In 2019, the U.S. Court of Appeals for the Second Circuit made headlines when it ruled that creditors' state law fraudulent transfer claims arising from the 2007 leveraged buyout ("LBO") of Tribune Co. ("Tribune") were...more
A recent opinion by the United States Bankruptcy Court for the Western District of North Carolina kept alive a bankruptcy trustee’s fraudulent conveyance claims based on, in part, the Internal Revenue Code (“IRC”) 10-year...more
The United States District Court for the District of Connecticut, applying Connecticut law, has found no coverage under a director and officers liability policy for a claim alleging the fraudulent conveyance of a company...more
Section 548 of the Bankruptcy Code provides a bankruptcy trustee (or the debtor-in-possession) the power to set aside or “avoid” certain transfers of the debtor’s assets out of the bankruptcy estate that may otherwise place...more
New York County Supreme Court Justice Schecter dismissed a fraudulent conveyance action brought by UMB Bank, N.A., the indenture trustee for certain of Neiman Marcus’ senior notes, on the basis that the applicable indenture...more
The Securities and Exchange Commission has signaled that it expects to see an uptick in fraudulent accounting activities in the wake of the financial downturn caused by the COVID-19 pandemic. In a similar vein, the Financial...more