News & Analysis as of

Successor Liability Fair Labor Standards Act (FLSA)

Seyfarth Shaw LLP

Are You Really Protected From Wage-and-Hour Successor Liability in an Asset Purchase?

Seyfarth Shaw LLP on

Seyfarth Synopsis: In acquiring a company, there is often a tendency to think an asset purchase (as opposed to a stock purchase) guarantees the purchaser will not inherit any liability (so-called “successor liability”). This...more

Obermayer Rebmann Maxwell & Hippel LLP

FLSA Successor Liability - More Than You Bargained For

A common method for business expansion is for one company to acquire another company’s operations and then merge the operations into the acquiring company. However, even when care is taken to structure such acquisitions to...more

Skadden, Arps, Slate, Meagher & Flom LLP

Employment Flash - October 2015

SEC Adopts CEO Pay Ratio Rule - The U.S. Securities and Exchange Commission (SEC) recently adopted a final rule requiring public companies to disclose the ratio of annual pay of their chief executive to median annual pay...more

Franczek P.C.

Limiting Successor Liability Under The FLSA: Wage And Hour Due Diligence

Franczek P.C. on

Recently, my colleague Lindsey Marcus guest authored a post on yet another successor liability case, this time out of the Third Circuit. Her post reminded me of another case in the Seventh Circuit from 2013, and a larger...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

Third Circuit Articulates Theories Of Successor Liability Under FLSA

In Thompson v. Real Estate Mortgage Network, No. 12-3228 (3d. Cir. Apr. 3, 2014), the Third Circuit Court of Appeals recently found a successor employer potentially responsible for Fair Labor Standards Act (FLSA) violations...more

Franczek P.C.

Third Circuit Applies More Relaxed Federal Standard To Successors In FLSA Cases

Franczek P.C. on

The Third Circuit Court of Appeals, which covers Pennsylvania, New Jersey, Delaware, and the U.S. Virgin Islands, recently became the third appellate court to adopt the federal common law standard for successor liability in a...more

Fisher Phillips

Third Circuit Addresses FLSA "Successor" Liability

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Federal courts continue to embrace a broad view in evaluating the question of whether federal Fair Labor Standards Act liability may be imposed upon a successor company in particular situations. ...more

Troutman Pepper

Third Circuit Holds That Successor Liability Exists Under The Fair Labor Standards Act

Troutman Pepper on

The Third Circuit Court of Appeals recently held for the first time that a predecessor’s wage-and-hour violations under the Fair Labor Standards Act (FLSA) can result in liability for a successor employer. The Third Circuit’s...more

Foley & Lardner LLP

Because M&A Due Diligence Was Not Already Complicated Enough…

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A recent federal appeals court decision suggests that businesses looking at potential acquisitions or mergers have yet another, relatively new concern to their due diligence list when examining the target business: an...more

Genova Burns LLC

Employer Can Be Liable For Its Predecessor’s FLSA Violations

Genova Burns LLC on

The Third Circuit Court of Appeals recently held that an employer can be liable for its predecessor’s violations of the Fair Labor Standards Act. Thompson v. Real Estate Mortgage Network, No. 12-3828 (3d Cir. Apr. 4, 2014)....more

Cole Schotz

Third Circuit Embraces Successor Liability for Wage-and-Hour Violations of the Fair Labor Standards Act

Cole Schotz on

In a recently decided case, Thompson v. Real Estate Mortgage Network, Case No. 12-3828 (3d Cir. Apr. 3, 2014), the Third Circuit Court of Appeals determined for the first time that a successor-employer may be held financially...more

Shumaker, Loop & Kendrick, LLP

Insights - Spring 2013: Developing Federal Common Law of Successor Liability

When a purchaser acquires substantially all the assets of a seller, the purchase agreement typically provides that the purchaser does not assume seller’s liabilities except to the limited extent specifically set forth...more

Sands Anderson PC

Buyer Beware of Successor Liability For FLSA Claims

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Businesses often acquire other businesses through an asset purchase, rather than a stock purchase, so that the buyer does not inherit the liabilities of the seller. Not all business owners realize that federal labor law...more

Brownstein Hyatt Farber Schreck

Buyer Beware: Seventh Circuit Upholds Application of the Federal Common Law Standard of Successor Liability in an Asset Sale

One of the benefits to structuring an acquisition as an asset deal is that the buyer has the ability to choose the liabilities that it will assume and the liabilities that will remain with the seller, including contingent...more

Pillsbury Winthrop Shaw Pittman LLP

7th Circuit Holds Successor Liable for FLSA Claims, Despite Buyer’s Disclaimer

In Teed v. Thomas & Betts Power Solutions, LLC, the 7th Circuit in an opinion written by Judge Posner held that, absent a good reason to withhold liability, a purchaser of assets was subject to successor liability for Fair...more

Dickinson Wright

Successor Liability Under The FLSA: Seventh Circuit Holds Purchaser Of Assets From Receiver Of Company Which Had Violated FLSA...

Dickinson Wright on

In a case which is sure to complicate the sale of companies (or discrete divisions thereof) and have widespread influence in other Circuits, the Seventh Circuit recently held that a company which acquired the assets (not...more

Foley & Lardner LLP

Asset Acquisition Comes With Unexpected FLSA Pain

Foley & Lardner LLP on

Some bargains are not as they seem. An asset-acquiring Company discovered this the hard way in Teed v. Thomas & Betts Power Solutions. In the case, at an auction, Thomas & Betts purchased the assets of a company in...more

Morgan Lewis

Seventh Circuit Affirms Imposition of Successor Liability for FLSA Claims

Morgan Lewis on

Purchasing company is found to be subject to successor liability for federal employment-related claims, even where it explicitly disclaimed such liability in the transfer of assets....more

Baker Donelson

Seventh Circuit Extends FLSA Successor Liability to Asset Purchaser

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The U.S. Court of Appeals for the Seventh Circuit became the second federal appellate court to extend successor liability under the FLSA to an asset purchaser. In Teed et al, v. Thomas & Betts Power Solutions, LLC, the...more

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