Investments Number of Investments 2 Wellspring Capital Management has made 2 investments. 2010); Saifullah v. Johnson, 948 F.2d 1282, at *1 (4th Cir. Adversary Proceeding No. 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. The firm's objective is to . . View Videos. Tenn. 1991); 11 U.S.C. 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. 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. Already a subscriber? PLEASE SEE THIS LINK FOR FULL DISCLAIMER: https://www.wellspringcapital.co.uk/disclaimer. Our tight-knit culture enables transparent oversight and a streamlined decision-making process. Posted By: Imright , 3/3/2023 9:31:52 PM. The firm, which is based in New York City, was founded in 1995 by Martin Davis and Greg Feldman. Id. In June 2017, Gymboree announced it was filing for Chapter 11 bankruptcy protection. They are not actionable. The amended complaint is dismissed. Law360 takes your privacy seriously. In Cyrus II, the court also acknowledged that the Fourth Circuit has found otherwise and determined that state choice of law rules should be used in bankruptcy cases. 20-50554, 2021 WL 4823513 (Bankr. Cancellation and Refund Policy, Privacy Policy, and A litigation trust formed through the SportCo bankruptcy then sued, among others, SportCos former directors and its equity sponsor. The. Brought up in a family enjoying long-term success in real estate investment, Avrohom instead turned to the stock market. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. It identifies undervalued companies whose share price does not properly reflect the true value of the business. 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 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. Business Restructuring, As a result, the defendants argue, it would be unjust for Prospect to now be able to avoid the distributions. Wellspring Capital Management is a leading middle-market private equity firm headquartered in New York. Environmental, Social and Governance (ESG), HVAC (Heating, Ventilation and Air-Conditioning), Machine Tools, Metalworking and Metallurgy, Aboriginal, First Nations & Native American. The firm, which is based in New York City, was founded in 1995 by Martin Davis and Greg Feldman. WELLSPRING CAPITAL MANAGEMENT LIMITED is registered in England and Wales under Company Number 12429146, PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. For the reasons set forth below, under the law of either state, the plaintiff's first and second causes of action must be dismissed. Mr. Friedman was substituted as the plaintiff on January 10, 2020. Share Your Design Ideas, New JerseysMurphy Defends $10 Billion Rainy Day Fund as States Economy Slows, This Week in Crypto: Ukraine War, Marathon Digital, FTX. The issue in Merritt Dredging was the sale of a barge and the priority of parties' interests in the proceeds of the sale. 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. Time to Read: 6 minutes 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. Wellspring also rejected in cursory fashion the defendants argument that it is not necessarily a breach . Sounds like a tidy deal at year end [2017] made a lot of sense." endstream endobj startxref hXO8WtVH,~W"I/ {;N7'0HAA0%`Ih5L!p! After the defendants filed replies, the Court held a hearing on June 18, 2020. Certain state securities regulatory authorities have similar exemptions based on . Investment Philosophy; Target Investments; Portfolio The seller, PE outfit Levine Leichtman Capital Partners, purchased the company in 2015. 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. 0 Va. Mar. See Francis v. Giacomelli, 588 F.3d 186, 192 (4th Cir. We are taking this matter very seriously, and have launched an immediate internal investigation, Jeffrey Gould, Wellsprings head of marketing and investor relations, told investors last week in a note seen by Bloomberg News. David R. Duncan US Bankruptcy Judge District of South Carolina. 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. 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. Therefore, the plaintiff argues that he is only required to establish constructive fraud. "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."'" Since its founding in 1995, Wellspring has raised over $4 billion of initial capital commitments through . 1997) (citing Bannister v. Hertz Corp., 316 S.C. 513 (Ct. App. pursue new growth opportunities through strategic initiatives, operating improvements and add-on acquisitions. 1994)). A customer lawsuit filed earlier this month against Sequoia, Paradigm, and Thoma Bravo, alleges these funds gave an "air of legitimacy" to FTX andvia their hundreds of millions in funding and. 6. The firm, which is based in New York City, was founded in 1995 by Martin Davis and Greg Feldman. 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." 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. e""8*&B 598, 614 (Bankr. %PDF-1.5 % The plaintiff responds that the statements relate to presently existing facts and that opinions are actionable in a negligence context. See Scheidelman v. Henderson (In re Henderson), 423 B.R. E-mail: sandra@wellspring-cap.com; Videos. (quoting Edwards v. City of Goldsboro, 178 F.3d 231, 244 (4th Cir. Flipbooks. 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. at *3 (quoting In re Sharp Int'l Corp., 403 F.3d 43, 53 (2d Cir. Sav. Please see our Privacy Policy. The Wellspring court was ruling on a motion to dismiss, and therefore accepted the plaintiffs somewhat barebones and perhaps self serving assertions as true and in the light most favorable to that plaintiff. 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 emails, often using colorful language and harassing tones, essentially represent to Prospect that if the AcuSport transaction is not completed, Prospect will not get paid on its obligations. After all, corporate decisionmakers are often tasked with choosing a path where outcomes are at best uncertain. P. 12(b)(6). Wellspring Capital Management, LLC; Wellspring Cap. The Partners of Wellspring constitute a long-tenured team, having worked together an average of 15 years over three funds. You have to know whats happening with clients, competitors, practice areas, and industries. R. Civ. Despite that agreement in principle, it was alleged in relevant part that: Unable to agree on the release and indemnification issue, SportCos out-of-court restructuring failed, and SportCo defaulted on its funded debt shortly thereafter. 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. The court addressed the dissent's finding, that the defendant's determination of the number of parking spaces was a matter of judgment or opinion and was therefore unactionable. Wellspring has one of the best track records in middle-market private equity; its people, capital and reputation bring certainty to transactions. When typing in this field, a list of search results will appear and be automatically updated as you type. Munich, by far the largest city in southern Germany, lies about 30 miles (50 km) north of the edge of the Alps and along the Isar River, which flows through the middle . The plaintiff does not dispute that the amended complaint does not plead actual fraud, and it clearly does not. 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. Since its founding in 1995, Wellspring has raised over $4 billion of initial capital commitments through . Wellspring Capital Management, founded in 1995, is a middle-market private equity firm that has approximately $2 billion of private equity capital under management. See Sheehan v. Saoud, 650 Fed. San Francisco Bay Area, Silicon Valley), Operating Status of Organization e.g. Wellsprings objective is to bring partnership, experience and value creation to each investment. Follow along as he lays out the blueprint for his career, and takes us all the way from his first sketch to his thriving personal brand, Spunge. Ashmore for Wilson v. Dodds, 262 F. Supp. 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." 2018) (distinguishing cases where the courts dismissed negligent misrepresentation claims based on "puffery" or founded solely on speculative statements regarding future profits as a result of proposed transactions, and finding that the misrepresentations at issue were actionable because they involved present facts). 22-2003, 2023 WL 1098189 (3d Cir. CDI's smaller Atlanta peer said to weigh sale in '18. Over $134 million of the loan proceeds were used to fund distributions to Wellspring Capital Partners, WCM GenPar IV, L.P., WCM GenPar IV GP, LLC, F. Hewitt Grant, Charles E. Walker, Jr., Todd Boehly, Bernard Ziomek, and Andrew Kupchik (collectively, the "Transferee Defendants"). These tools have been used since the firm's inception in 1995 to generate consistent business improvement in its portfolios. The court considered whether inaccurate credit ratings can form the basis for a negligent misrepresentation claim. Asia Pacific; EMEA; Latin America; UK Solicitors; UK Bar; United States The Court further notes that here, section 548 is not available to the plaintiff due to the timing of the transfers and the bankruptcy filings. In 2008, Wellspring Capital, through its fund Wellspring Capital Partners, acquired Ellett. The portfolio manager is also a co-investor in the strategy. Casetext, Inc. and Casetext are not a law firm and do not provide legal advice. 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. your most valuable capital, your ultimate resource. with actual intent . The Company specializes in private companies buyouts, acquisitions of divisions and subsidiaries of public companies, and going . For example, the October 27, 2017 email stated, "The only way to optimize is to merge with Acusport." Menu Home; Rankings. 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. Law360 provides the intelligence you need to remain an expert and beat the competition. These all relate to a proposed business transactionthe purchase by Ellett of AcuSport. 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. The Wellspring court dismissed the litigation trusts claim for breach of the fiduciary duty of care, holding that it was not adequately pled. Corporate Advocacy Program. Financial terms of the transaction were not disclosed. Wellspring Capital Management. By teaming up with strong management, Wellspring is able to unlock underlying value and. N.D.N.Y. at 613-14. Wellspring Capital Management is an American private equity firm focused on leveraged buyout investments in middle-market companies across a range of industries. If you do not agree with these terms, then do not use our website and/or services. Contribute to chinapedia/wikipedia.en development by creating an account on GitHub. They are simply not statements of preexisting fact that were false when made. Industry: Investment & Asset Management. Additionally, the plaintiff argues that the third element of New York's third-party beneficiary test is not met because there is no express intent in the Loan Agreements or the Amendments to compensate the defendants in the event the distributions were not paid and in fact, the Loan Agreement indicates the opposite by virtue of the inurement clause found in Section 13.1. The defendants asserted common arguments in support of dismissal, but all arguments made in support of dismissal were not asserted by each defendant. While New York law and South Carolina law have slightly different tests for avoiding constructive fraudulent conveyances, there exists a common thread which is not satisfied hereinsolvency at the time of the transfer. Litigation. Reputation Management. 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. Middle Market Private Equity. This is the best way to manage and repair your business reputation. Ellett Brothers LLC ("Ellett"), a South Carolina limited liability company, was a sporting goods distributor. From October 2017 to April 2018, Mr. Carles and Mr. Johnson sent numerous emails to representatives of Prospect, attempting to induce Prospect to agree to forego exercising its rights in the event of a default. Your livelihoodand your sanitydepend . The 2011 Wellspring Capital Partners V LP was fully invested at $1.2 billion and has generated positive returns for its investors to-date. [Amended Complaint, 51]. Click here to login, 2023, Portfolio Media, Inc. | About | Contact Us | Legal Jobs | Advertise with Law360 | Careers at Law360 | Terms | Privacy Policy | Cookie Settings | Help | Site Map, Enter your details below and select your area(s) of interest to stay ahead of the curve and receive Law360's daily newsletters, Email (NOTE: Free email domains not supported). New York law prohibits both actual and constructive fraudulent conveyances.