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. Investment Approach Target Investments Wellspring's objective is to acquire or invest in companies that are well-positioned to capitalize on change and can benefit from Wellspring's operating and financial expertise. Instead, they may form the basis for a negligent misrepresentation claim if the party making the misrepresentation possesses some special expertise (by way of his job title or position, for example), or has some special knowledge about the particular fact that is allegedly misrepresented. You can review interesting Flipbooks on my site. The elements of a negligent misrepresentation claim under New York law are: The plaintiff also cites King County, Washington v. IKB Deutsche Industriebank, 863 F. Supp. Wellspring has one of the best track records in middle-market private equity; its people, capital and reputation bring certainty to transactions. @S1 $82N+ZJ | It identifies undervalued companies whose share price does not properly reflect the true value of the business. Since its founding in 1995, Wellspring has raised over $4 billion of initial capital commitments through . Shoe designer and creative Salehe Bembury takes us on a journey from his childhood growing up in Manhattan, to an invaluable degree in industrial design, to working with some of the biggest names in fashionbefore breaking off to make his own name. Financial terms of the transaction were not disclosed. You have to know whats happening with clients, competitors, practice areas, and industries. Probitas Partners acted as exclusive placement agent and Paul, Weiss, Rifkind, Wharton & Garrison LLP as legal counsel with respect to formation of Fund VI. 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. When it comes to helping companies that show promise, Wellspring Capital Management is overflowing with support. 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. Id. 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 responds that Prospect is a preexisting creditor because the distributions were not made until after Prospect became a creditor when the Loan Agreements and the Amendments were signed. Wellspring Capital Management is a leading private equity firm headquartered in New York. REGISTRATION STATUS . Later emails berate Prospect's representative for failing to agree to the AcuSport purchase more quickly. THE RISK OF LOSS IN TRADING COMMODITY INTERESTS CAN BE SUBSTANTIAL. Since its founding in 1995, Wellspring has raised over $4.0 billion of initial capital commitments through . These emails may be a lot of things, but negligent misrepresentations they are not. 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"). S.D. 2007) (citations omitted). 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. 1996)). Wellspring Capital Management is a leading private equity firm headquartered in New York. Accordingly, SportCo began negotiations with certain of its lenders around a potential restructuring transaction. Id. Time to Read: 6 minutes SportCos negotiations were led by a SportCo director, who was also the managing partner of Wellspring Capital, SportCos equity sponsor. Todd Boehly filed a joinder to the Wellspring Defendants' motion to dismiss. The defendants argue that this cause of action must be dismissed because the alleged misrepresentations were forward-looking statements and opinions; therefore, they are not actionable and cannot form the basis for a negligent misrepresentation cause of action. 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. 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. Please see our Privacy Policy. The Debtors in the bankruptcy cases, pending in the District of Delaware, are SportCo Holdings, Inc.; Ellett Brothers, LLC; United Sporting Company, Inc.; Bonitz Brothers, Inc.; Evans Sports, Inc.; Jerry's Sports, Inc.; Outdoor Sports Headquarters, Inc.; Quality Boxes, Inc.; and Simmons Guns Specialties, Inc. The court stated: See Credit Alliance Corp. v. Arthur Anderson & Co., 65 N.Y.2d 536 (NY App. These facts, as recited in the complaint, are taken as true for purposes of the motions to dismiss. The basic complaint is that Wellspring directors put self-interests above those of the company and its creditors. 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. W.D. Id. Since its founding in 1995, Wellspring has raised over $4.5 billion of initial capital commitments through six private equity funds. The defendants argue that New York law should apply, first, because the Loan Agreements and the First and Second Amendments contain choice of law provisions stating that New York law will apply and second, because South Carolina choice of law analysis dictates that New York law should apply. Wellspring Capital, Mr. Carles, and Mr. Johnson were not insiders of AcuSport, and the amended complaint does not allege that they had any special knowledge or information about AcuSport that was not available to the public. 2021 by wellspring capital Management. 2100 Geng Road, Suite 210 Palo Alto, CA 94303. 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. The defendants asserted common arguments in support of dismissal, but all arguments made in support of dismissal were not asserted by each defendant. The firm's objective is to bring partnership, experience and value creation to each investment. The Loan Agreements and the First and Second Amendments each contain a choice of law provision, providing that New York law applies. CDI's smaller Atlanta peer said to weigh sale in '18. Sounds like a tidy deal at year end [2017] made a lot of sense." The amended complaint also details numerous emails sent by Mr. Carles and Mr. Johnson to a representative of Prospect, urging Prospect to defer its right to payment in the event of a default. By teaming up with strong management, Wellspring is able to unlock underlying value and. 544(b). 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 . Wellspring Capital Management has acquired 38 organizations. Menu Home; Rankings. [Amended Complaint, 57]. Wellspring Capital Management is a mega-sized private equity firm that focused on a variety of transaction situations. In Fall 2018, SportCo Holdings, Inc. (SportCo) was facing severe financial distress. King County, 863 F. Supp.2d at 318. Cases involving other matters not classified elsewhere, 890, 1890, 1990, 2890, 2899, 2999, 3375, 3890, 3896, 3899, 3999, 4890, 4896, 4999, Wellspring Capital Management, LLC; Wellspring Cap v. Barry, III et al. . PLEASE SEE THIS LINK FOR FULL DISCLAIMER: This site is for informational purposes only. View contacts for Wellspring Capital Management to access new leads and connect with decision-makers. Wellspring, founded in 1995, has raised more than $4 billion of capital commitments through six private equity funds, according to its website. P. 12(b)(6) provides for dismissal of an action if the complaint "fail[s] to state a claim upon which relief can be granted." By teaming up with strong management, Wellspring is able to unlock underlying value and The plaintiff's third cause of action, for negligent misrepresentation against defendants Wellspring Capital, Mr. Carles, and Mr. Johnson, must also be dismissed. 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. N.D.N.Y. The firm, which is based in New York City, was founded in 1995 by Martin Davis and Greg Feldman. Consumers want to see how a business took care of business. A social media content creator signed an agreement with Birchbox in May of 2022 and hadn't been paid the $2,500 due as of Jan. 24, despite several emails to the company. We are motivated and incentivised to succeed. The. 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. However, the Court has the discretion to sua sponte dismiss a complaint pursuant to Fed. To summarize New York law, then, it appears that opinions can be actionable, but are not always actionable. WELLSPRING CAPITAL MANAGEMENT ( CRD # 135455/SEC#:801-64341 ) WELLSPRING CAPITAL MANAGEMENT, WELLSPRING CAPITAL MANAGEMENT, INC. View latest Form ADV filed Part 2 Brochures. PLEASE SEE THIS LINK FOR FULL DISCLAIMER: https://www.wellspringcapital.co.uk/disclaimer. 541, 546 (Bankr. hbbd``b`u@IHEX 3X "2A`V @B'Hl``bdV8 2h Lister v. NationsBank of Delaware, N.A., 329 S.C. 133, 143 (Ct. App. 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. 2d 317 (S.D.N.Y. (Compl. 23, 2006) (stating that some courts characterize fraudulent conveyance actions as tort actions, while others characterize them as matters in equity). Sav. 91], Andrew Kupchik [Docket No. UNITED STATES BANKRUPTCY COURT DISTRICT OF SOUTH CAROLINA. 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. 1999)). For example, the October 27, 2017 email stated, "The only way to optimize is to merge with Acusport." 91], F. Hewitt Grant [Docket No. The first and second causes of action are dismissed. 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.
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