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This appeal concerned a limited liability company, JPB Investments LLC (JPBI), created and operated by respondent James Baldwin, a real estate developer. Appellant Curci Investments, LLC (Curci) sought to add JPBI as a judgment debtor on a multi-million dollar judgment it had against Baldwin personally. Curci asserted Baldwin held virtually all the interest in JPBI and controlled its actions, and Baldwin appeared to be using JPBI as a personal bank account. Curci argued, under these circumstances, it would be in the interest of justice to disregard the separate nature of JPBI and allow Curci to access JPBI’s assets to satisfy the judgment against Baldwin. Citing Postal Instant Press, Inc. v. Kaswa Corp. 162 Cal.App.4th 1510 (2008), the court denied Curci’s motion based on its belief the “reverse veil piercing,” was not available in California. On appeal, Curci asserted Postal Instant Press was distinguishable, and urged the Court of Appeal to conclude reverse veil piercing was available in California and appropriate in this case. The Court agreed Postal Instant Press was distinguishable, and concluded reverse veil piercing is possible under these circumstances. The Court reversed and remanded for the court to make a factual determination as to whether JPBI’s veil should be pierced. View "Curci Investments v. Baldwin" on Justia Law

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The interim adverse judgment rule applies when a trial court had initially denied summary judgment on the basis that a lawsuit had sufficient potential merit to proceed to trial but concluded after trial that the suit had been brought in bad faith because the claim lacked evidentiary support. In the underlying case, Plaintiffs were sued for misappropriation of trade secrets. Plaintiffs moved for summary judgment, which the trial court denied. The trial court subsequently granted judgment in favor of Plaintiffs. Plaintiffs later brought a malicious prosecution against the opposing parties’ lawyers in the trade secrets case. Defendants filed an anti-SLAPP motion, arguing that Plaintiffs could not establish a probability of success because the order denying summary judgment in the underlying trade secrets action established probable cause to prosecute that action. The trial court granted the motion to strike, concluding that the action was untimely. The court of appeal concluded that the action was timely but that the interim adverse judgment rule applied, thus barring the malicious prosecution suit. The Supreme Court affirmed, holding that the denial of summary judgment in the trade secrets action established probable cause to bring that action, and therefore, Plaintiffs could not establish a probability of success on their malicious prosecution claim. View "Parrish v. Latham & Watkins" on Justia Law

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Weyerhaeuser Company challenged an award of industrial insurance benefits to its former employee, Roger Street, for his low back condition, a claimed occupational disease. Weyerhaeuser argued that a worker must present expert medical testimony that the disease "arises naturally" out of employment. The Court of Appeals rejected Weyerhaeuser's argument, holding that the controlling case law required Street to present expert medical testimony to show that his back condition "arose naturally" from employment. Because there was medical testimony supporting the "arises proximately" requirement and lay testimony supporting the "arises naturally" requirement, the appeals court held that Street proved his low back condition was an occupational disease and affirmed the jury award of benefits. Finding no reversible error in the Court of Appeals’ decision, the Washington Supreme Court affirmed. View "Street v. Weyerhaeuser Co." on Justia Law

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The Eleventh Circuit affirmed the Tax Court's determination that petitioner was liable as a transferee under 26 U.S.C. 6901 for his former employer's unpaid taxes. Because the state substantive law in this case does not require exhaustion for liability to exist, the court held that the Commissioner was not required to exhaust remedies against the company before proceeding against petitioner as a transferee. In this case, applying Florida law, the court held that petitioner could not definitively prove that the Dividend Payments were a part of his employment with FECP and because he did not raise any other argument for why FECP might have received reasonably equivalent value even if the dividends were not compensation, the court must conclude that they were dividends for which FECP did not receive reasonably equivalent value. As such, the court affirmed the Tax Court's determination that the reasonable-value element of constructive fraud under the Florida Uniform Fraudulent Transfer Act was satisfied for all of the Dividend Payments. When considered together, those dividend payments were substantial enough for the Tax Court to conclude that they led to the insolvency of FECP. View "Kardash v. Commissioner of IRS" on Justia Law

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When Eclipse, a jet aircraft manufacturer, declared bankruptcy in November 2008, it reached an agreement to sell the company to its largest shareholder, ETIRC, which would have allowed Eclipse to continue its operations. The sale required significant funding from VEB, a state-owned Russian Bank. The funding never materialized. For a month, Eclipse waited for the deal to go through with almost daily assurances that the funding was imminent. Delays were attributed to Prime Minister Putin needing “to think about it.” Eventually, Eclipse was forced to cease operations and notify its workers that a prior furlough had been converted into a layoff. Eclipse’s employees filed a class action complaint as an adversary proceeding in the Bankruptcy Court alleging that Eclipse’s failure to give them 60 days’ notice before the layoff violated the Worker Adjustment and Retraining Notification (WARN) Act, 29 U.S.C. 2101-2109, and asserting that Eclipse could invoke neither the Act’s “faltering company” exception nor its “unforeseeable business circumstances” exception. The Bankruptcy Court rejected the employees’ claims on summary judgment, holding that the “unforeseeable business circumstances” exception barred WARN Act liability. The district court and Third Circuit affirmed. Eclipse demonstrated that its closing was not probable until the day that it occurred. View "In re: AE Liquidation, Inc." on Justia Law

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Plaintiff, a shareholder in three public companies, filed suit seeking disgorgement of "short-swing" profits under Section 16(b) of the Securities Exchange Act of 1934, 15 U.S.C. 78p(b), from investment entities controlled by Carl C. Icahn. The district court dismissed plaintiff's actions on behalf of the companies under Rule 12(b)(6). The Second Circuit affirmed the dismissal, holding that plaintiff has not plausibly alleged that Icahn failed to disgorge all of the premiums received for writing (selling) the put options. In this case, the complaint did not state a claim for relief because it relied exclusively on comparisons to options traded on the open market that have no meaningful similarities to the options at issue here. View "Olagues v. Icahn" on Justia Law

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DFC Global Corporation (“DFC”) provided alternative consumer financial services, predominately payday loans. The 2014 transaction giving rise to this appraisal action resulted in DFC being taken private by Lone Star, a private equity firm. DFC was a highly leveraged company. Its capital structure was comprised of about $1.1 billion of debt as compared to a $367.4 million equity market capitalization, 20 resulting in a debt-to-equity ratio of 300% and a debt-to-total capitalization ratio of 75%. In the years leading up to the merger, DFC faced heightened regulatory scrutiny in the US, UK and Canada. The parties challenged DFC’s valuation for merger purposes. The Delaware Supreme Court surmised DFC wanted the Court to establish a presumption that in certain cases involving arm’s-length mergers, the price of the transaction giving rise to appraisal rights was the best estimate of fair value. The Supreme Court declined to do so, which in the Court’s view had no basis in the statutory text, which gave the Court of Chancery in the first instance the discretion to “determine the fair value of the shares” by taking into account “all relevant factors.” The Supreme Court must give deference to the Court of Chancery if its determination of fair value has a reasonable basis in the record and in accepted financial principles relevant to determining the value of corporations and their stock. Ultimately, the Delaware Supreme Court reversed and remanded the Court of Chancery’s valuation, remanding for the Chancellor to reassess the weight he chooses to afford various factors potentially relevant to fair value, and he may conclude that his findings regarding the competitive process leading to the transaction, when considered in light of other relevant factors, such as the views of the debt markets regarding the company’s expected performance and the failure of the company to meet its revised projections, suggest that the deal price was the most reliable indication of fair value. View "DFC Global Corporation v. Muirfield Value Partners, L.P., et al." on Justia Law

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The right of public access is a fundamental element of the rule of law, important to maintaining the integrity and legitimacy of an independent Judicial Branch. The Dodd-Frank Act does not abrogate the common-law right of public access to judicial records. The D.C. Circuit held that there is nothing in the language of Dodd-Frank to suggest that Congress intended to displace the long-standing balancing test that courts apply when ruling on motions to seal or unseal judicial records. Therefore, the court vacated and remanded because the district court did not apply that test to the motion to unseal the records at issue here, but instead ruled that they were categorically exempt from disclosure. View "MetLife, Inc. v. Financial Stability Oversight Council" on Justia Law

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Petitioner Dao Nguyen appealed a New Hampshire Board of Barbering, Cosmetology, and Esthetics (Board) decision, suspending her personal license as a manicurist and revoking the shop license for Nail Care. In 2013, Board inspector Beulah Green conducted a routine inspection of Nail Care, finding numerous violations of the Board Administrative Rules (Rules), including two foot spas that were not disinfected properly, no record of cleaning for two foot spas, five tables that were not sanitized, numerous implements that were either not sanitized and disinfected properly or not discarded or disposed of properly, multiple “credo” blades, and the use of nail drills that are not manufactured for use on the natural nail (improper nail drills). For these violations, Green imposed a fine of $4,158. In the next few years, Green conducted additional inspections, and again found multiple, repeat violations of the Rules. Noting the repeated violations and the “blatant disregard” that the petitioner demonstrated towards the Rules, the Board suspended petitioner’s personal license for five years, revoked her shop license for Nail Care, and ordered her to pay all outstanding fines owed to the Board within 90 days. The Board also ruled that, if the petitioner’s license is reinstated, it will be subject to a three-year probationary period. Finding the Board’s decision was supported by substantial, credible evidence, the New Hampshire Supreme Court affirmed the Board’s decision. View "Appeal of Dao Nguyen" on Justia Law

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The Fifth Circuit affirmed the district court's decision to enjoin state court civil proceedings until the conclusion of the government's criminal investigation, or for a period of one year, whichever first occurred. The court held that the district court had authority to enjoin the state court proceedings where the general prohibition against federal courts granting injunctions to stay state court proceedings did not apply when the United States, as here, seeks the injunction. The company in this case was pursuing a civil lawsuit in state court seeking, among other things, return or ownership of electronic devices currently held by federal investigators. If not enjoined, further proceedings in state court, including civil discovery, could undermine the federal criminal investigation into the company. View "In re: Grand Jury Subpoena" on Justia Law