Active, Closed, This describes the type of investor this organization is (e.g. 1985). Casetext, Inc. and Casetext are not a law firm and do not provide legal advice. REGISTRATION STATUS . The Wellspring court dismissed the litigation trusts claim for breach of the fiduciary duty of care, holding that it was not adequately pled. [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]. A New York buyout baron has taken a leave of absence from his fund after an explosive lawsuit claimed last week that he threatened an ex-employee to keep quiet after she accused his son of raping her. @S1 $82N+ZJ | Mr. Friedman filed an amended complaint the same day. 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. hXO8WtVH,~W"I/ {;N7'0HAA0%`Ih5L!p! Munich | Germany, History, Population, Oktoberfest, & Facts - Britannica UNITED STATES BANKRUPTCY COURT DISTRICT OF SOUTH CAROLINA. Innovative Custom Brands, Inc. v. Minor, 2016 WL 308805, at *2 (S.D.N.Y. All rights reserved. Working at Wellspring Capital Management | Glassdoor Accordingly, Wellspring did not find that the defendants in fact breached their duties, but rather held that the plaintiff, a litigation trust, had asserted a viable claim that could proceed to a trier of fact. [Amended Complaint, 93]. However, whether a fraudulent conveyance action is characterized as a tort action is unsettled. Wellspring buys PE-backed Center for Diagnostic Imaging Wellspring Capital formed SportCo Holdings, Inc. ("SportCo") to serve as a holding company for United Sporting Company, Inc. ("United Sporting"), Ellett's direct parent; Ellett; and its subsidiaries. Id. The assignment was executed in New York, but the personal property was located in South Carolina at the time the assignment was executed. 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. . Va. Mar. 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. In King County, the court considered suits by investors seeking to recover losses incurred after the collapse of a structured investment vehicle. The elements of a negligent misrepresentation claim under South Carolina law are as follows: Turning now to the present case, the third cause of action must be dismissed under either New York or South Carolina law because the statements that the plaintiff asserts constituted negligent misrepresentations were all statements regarding potential outcomes of a potential business endeavor; thus, they relate to future events and cannot form the basis of a negligent misrepresentation claim. F. Hewitt Grant asserted the lack of a triggering creditor due to Prospect Capital Corporation's knowing participation in the transfers and failure to state a claim under New York law due to lack of insolvency and under South Carolina law due to failure to plead actual fraud. Sec'y of State for Def. James Chan - Spare Room Tycoon - The Seventy Lessons of Sane Self 609, 614 (Bankr. 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 2011 Wellspring Capital Partners V LP was fully invested at $1.2 billion and has generated positive returns for its investors to-date. 541, 546 (Bankr. at 382. 2021 by wellspring capital Management. with actual intent . 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. We charge a minimal base fee and the rest is performance fees we generate for clients and not on the amount of capital clients allocate. The first and second causes of action are dismissed. To summarize New York law, then, it appears that opinions can be actionable, but are not always actionable. The Wellspring Defendants asserted all of these arguments and also asserted failure to state a claim under section 550 against certain defendants. Mr. Friedman was substituted as the plaintiff on January 10, 2020. Id. & Loan Ass'n v. Hirschfeld, 476 N.Y.S.2d 292 (N.Y. App. 101 (32). 24. In Fall 2018, SportCo Holdings, Inc. (SportCo) was facing severe financial distress. Wellspring CEO Bill Dawson is taking a leave of absence, the firm said Tuesday Last week a shocking lawsuit was filed against his son Christopher It claims he drugged and violently raped and. The company will explode Rich!" These are high quality companies, essential to the national, regional, or global economy but whose fundamental qualities are underappreciated and undervalued by the market. The firm's objective is to bring partnership, experience and value creation to each investment. Prior results do not guarantee a similar outcome. Contribute to chinapedia/wikipedia.en development by creating an account on GitHub. The defendants' motions rely on Federal Rule of Civil Procedure 12(b)(6). From reading the Financial Times at school to managing his first portfolio at just 18, he has built Wellspring Capital into a nationwide wealth management boutique. Oct. 14, 2021) (Stickles, J.) The Court now issues this order, granting the motions to dismiss for the reasons set forth below. 90], Alexander E. Carles [Docket No. Andrew Kupchik argued dismissal was necessary due to Prospect's ratification and/or consent to the distributions, due to failure to state a claim under New York law because of lack of insolvency and failure to state a claim under South Carolina law due to failure to plead actual fraud, due to the expiration of the statute of limitations on the fraudulent conveyance claims, and due to failure to plead the existence of a triggering unsecured creditor. Blackstone to Acquire Tradesmen International from Wellspring Capital The Company specializes in private companies buyouts, acquisitions of divisions and subsidiaries of public companies, and going . Todd Boehly filed a joinder to the Wellspring Defendants' motion to dismiss. Ellett used $54,860,549.74 of the First Amendment loan proceeds to fund distributions to the Transferee Defendants. In an email obtained by . Va. June 8, 2011) (acknowledging that Maryland law is not clear regarding whether a fraudulent conveyance action sounds in tort, but concluding that "given that the gravamen of the fraudulent conveyance claim is the wrongfulness of the conveyance and the injury to the creditor, rather than balancing equities or fairness, it is appropriate to conclude that fraudulent conveyance claims sound in tort. 91], Andrew Kupchik [Docket No. 23, 2006) (stating that some courts characterize fraudulent conveyance actions as tort actions, while others characterize them as matters in equity). 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." Fed. A free inside look at Wellspring Capital Management salary trends based on 22 salaries wages for 17 jobs at Wellspring Capital Management. SEC / JURISDICTION. The defendants' motions to dismiss are granted. It identifies undervalued companies whose share price does not properly reflect the true value of the business. 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. Id. As we here at Ropes & Gray look back on 2021 and ahead into 2022, we call your attention to the lessons of Friedman v. Wellspring Capital Mgmt., LLC (In re SportCo Holdings, Inc.), Case No. Wellspring Capital Management, founded in 1995, is a leading middle-market private equity firm that manages more than $3 billion of private equity capital. 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. Wellspring is a cautionary tale for the fiduciaries of a distressed or potentially distressed corporationparticularly with respect to negotiations around release and/or indemnification provisions for those same fiduciaries. The plaintiff/litigation trust also asserted claims directly against Wellspring Capital under an aiding and abetting theoryi.e., asserting that Wellspring Capital itself aided and abetted the SportCo Boards alleged fiduciary duty breaches. Wellsprings facts, as alleged, are fairly straightforward. [Amended Complaint, 32]. 2021 by wellspring capital Management. 91], F. Hewitt Grant [Docket No. PLEASE NOTE: A verification email will be sent to your address before you can access your trial. Tenn. 1991); 11 U.S.C. The South Carolina Supreme Court stated that New York law would govern the validity of the transfer before it, unless applying New York law would result in a violation of South Carolina public policy. Wellspring targets investments with the following characteristics: Wellspring Philanthropic: An Ocean of "Dark Money" on the Left 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. Wellspring Capital Management | LinkedIn 0 Type: Company - Private. See Sheehan v. Saoud, 650 Fed. PLEASE SEE THIS LINK FOR FULL DISCLAIMER: This site is for informational purposes only. Since its founding in 1995, Wellspring has raised over $4.0 billion of initial capital commitments through six private equity funds. We look forward to carrying forward that vision and continuing our success in the years ahead.". Phone: 650 729-8626. 22-2003, 2023 WL 1098189 (3d Cir. at 613-14. After the defendants filed replies, the Court held a hearing on June 18, 2020. This approach has historically delivered returns well above inflation Our clients The firm's objective is to bring partnership, experience and value creation to each investment. An actual fraudulent conveyance is any "conveyance made . 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 . Reputation Management. 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 Wellsprings investment professionals possess diverse and complementary backgrounds that combine valuable experience in private equity, restructuring, corporate finance, capital markets and corporate law. The plaintiff's first and second causes of action are based on 11 U.S.C. The complaint must provide more than mere "labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Wellspring Capital Management is a leading private equity firm headquartered in New York. Sav. The plaintiff, Ronald J. Friedman, the trustee for the SportCo Creditors' Liquidation Trust, filed an omnibus response to the motions to dismiss [Docket No. 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. Wall Street tycoon takes leave of absence after lawsuit claims his son Seth Pearson - Managing Director - Private Equity - York Capital PDF Wellspring CEO Takes Leave After Son Accused of Rape in Lawsuit 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. The defendants argue that Prospect is a subsequent creditor, because it had knowledge of and approved of the distributions prior to them being completed. . *aUQBT&1#J$8Q)=WE9M'v1s_)GG+.kbN;yELi.UD1N{f'u$y`'GCJfS;4yXwbW${%^tcxG2}+/P@U `a$b6? To this end, Wellspring reinforces two key principles in particular: We encourage you to contact your Ropes & Gray team to discuss these matters more fully. This is the best way to manage and repair your business reputation. R. Civ. Aug. 27, 2020). For example, the October 27, 2017 email stated, "The only way to optimize is to merge with Acusport." Wellspring Capital is a boutique discretionary management service - with a portfolio positioned for high performance. Id. 2d 520, 529 n.14 (E.D. William F. Dawson, Jr., Chief Executive Officer of Wellspring, said, "My partners and I are pleased to complete the successful raising of Wellspring's sixth fund, which is a direct result of the strong relationships we have built with the investment community over many years and the returns we have generated. 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 Capital Management is an American private equity firm focused on leveraged buyout investments in middle-market companies across a range of industries. e""8*&B 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. The amended complaint asserts three causes of action: (1) avoidance and recovery of fraudulent transfers by Ellett against the Transferee Defendants pursuant to 11 U.S.C. wikipedia.en/Vatterott_College.md at main chinapedia/wikipedia.en "); Terry v. Walker, 2006 WL 736861, at *5 (W.D. "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."'" The choice of law provision in the Loan Agreements states: In October 2017, Wellspring Capital was contemplating a purchase of AcuSport, a competitor, by Ellett, for $14.8 million. %%EOF 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. 915 0 obj <> endobj 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. Wellspring, 2021 WL 4823513, at *10. The defendants' remaining arguments need not be addressed. If our offering sounds like something you would like to discuss, please get in touch on any of our contact details or the form below. The portfolio manager is also a co-investor in the strategy. 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. 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. 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. The defendants filed separate motions. Jan. 30, 2023). 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. Wellspring Capital Management Investor Profile: Portfolio & Exits . Wellspring also rejected in cursory fashion the defendants argument that it is not necessarily a breach . 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. About Us - Wellspring Capital Id. Wellspring CEO takes leave after explosive rape allegations against his son For the reasons set forth below, under the law of either state, the plaintiff's first and second causes of action must be dismissed. James brought a civil suit against Trump in September, alleging the Trump organization had fraudulently inflated the value of . There are no allegations in the amended complaint that the debtors' liabilities exceeded their assets at the time of the transfers. See Scheidelman v. Henderson (In re Henderson), 423 B.R. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). Flipbooks. Investment Philosophy; Target Investments; Portfolio Trump legal team requests six-month delay in New York civil lawsuit at 385. App'x 143 (4th Cir. Wellspring Capital Management is a leading middle-market private equity firm headquartered in New York. Practices: Similarly, Merritt Dredging suggests that federal law would apply to a section 548 cause of action, but that state law should apply to fraudulent conveyance claims based on state law. 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 [. Ashmore for Wilson v. Dodds, 262 F. Supp. Wellspring Capital - Middle Market Private Equity 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." The court must construe the allegations in the complaint in the light most favorable to the plaintiff. to negotiate for release or indemnification, with the defendants arguing that such releases may have saved the post-restructuring company the expense of indemnifying the D&O Defendants in subsequent litigation. However, the Court has the discretion to sua sponte dismiss a complaint pursuant to Fed. Wellspring Capital Management is a leading private equity firm headquartered in New York. Financial terms of the transaction were not disclosed. 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. 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. Their most recent acquisition was Caring Brands International on Oct 25, 2021.
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