Legal News

In D’Allesandro v. Lennar Hingham Holdings, LLC, 486 Mass 150, 2020 Mass. LEXIS 721, the Supreme Judicial Court of Massachusetts answered a certified question regarding how to apply the Massachusetts statute of repose, Mass. Gen. Laws ch. 260, § 2B, in regards to phased construction projects. The court held that, in this context, the completion of each individual “improvement” to its intended use, or the substantial completion of the individual building and the taking of possession for occupa...

Dealmakers know that uncertainty is their proverbial kryptonite. As M&A and investment have started to show signs of life, acquirers of and investors in companies that received loans under the Paycheck Protection Program (PPP) have been grappling with managing the risks associated with those loans, including whether and what kinds of approvals are necessary to acquire or invest in such a target. Recently, however, the U.S. Small Business Administration (SBA) has acted to reduce this uncertainty....

Dealmakers loathe uncertainty. In addition to the challenges of analyzing impacts of COVID-19 on a business and on closing transactions generally, they must navigate myriad issues arising from use of government stimulus loans, grants and other programs – in many cases without clear answers. We have discussed the recently released rules from the Small Business Administration (SBA) for acquiring control of a business that received a loan under one of the most popular stimulus programs, the...By: ...

The ability to raise capital is one of the most critical challenges facing small businesses in the U.S. today. Capital can allow for exponential growth of a well-run startup with a good idea, but the lack of capital is the death knell for many others. While many small companies initially rely on friends and family for funding, there has perennially been a gap between raising money from those in your immediate circle and working with investment bankers who are registered broker-dealers for larger...

When considering whether to acquire a business through an asset sale, it is important for the purchaser to analyze what, if any, of the seller’s liabilities it must assume to continue the seller’s operations. Prudent purchasers examine a multitude of factors (see our articles on successor liability and fraudulent transfers) in deciding whether to assume debt, including whether more cost effective alternatives exist for the space, goods or services......By: White and Williams LLP

As the pandemic-induced recession continues, there will be increasing opportunities for investors to acquire failing businesses at bargain prices. Companies with sound business models that were until recently profitable may now be faced with no better option than to sell their assets for as much as the open market will pay. Buyers of these failing companies will likely have the power to strike favorable deals for amounts that sellers would have summarily rejected six months ago. However, buyers....

If the 2008 recession gives us the ability to predict anything about upcoming trends in commercial litigation, it is that healthy companies, which normally would not be targeted as defendants, will be sued because the primary wrongdoers are judgment proof. Businesses that are owed money from defunct companies are unlikely to accept substantial losses without exploring ways to collect their debt from third parties, whose liability may not be readily apparent. Under the law of most states, there.....

In Factory Mut. Ins. Co. v. Skanska United States Bldg., No. 18-cv-11700-DLC, 2020 U.S. Dist. LEXIS 95403 (Skanska), the United States District Court for the District of Massachusetts considered whether contractors on a construction job were additional insureds on the developer’s builder’s risk insurance policy. After a water loss occurred during construction, the builder’s risk insurance carrier paid its named insured for the resultant damage, and subsequently filed a subrogation action agai...

Since the start of the COVID-19 pandemic, several buyers in M&A transactions have sought to avoid closing on a transaction alleging that the seller experienced a material adverse effect (MAE) or breached interim operating covenants between signing and closing. A MAE is typically defined in the definitive agreement and can be a heavily negotiated point and interim operating covenants have historically been tied to operating in the ordinary course......By: White and Williams LLP

In Mech. Inc. v. Venture Elec. Contrs., Inc., No. 2018AP2380, 2020 Wisc. App. LEXIS 170, the Court of Appeals of Wisconsin, District Two, considered whether a party may bring a negligence claim for purely economic damages. In upholding the lower court, the appellate court found that a party is barred by the Economic Loss Doctrine from bringing a negligence claim for purely economic damages....By: White and Williams LLP