Monthly Archives: September 2018

Buyer of trucking business held liable for unpaid compensation of former seller employees under the federal layoff notice law – the WARN Act

Seller, based in Little Rock, Arkansas, owned and operated a commercial trucking business that serviced customers throughout the United States. On December 4, 2008, Seller and Buyer (also a trucking company with headquarters in Indianapolis, Indiana) entered into a written

Posted in layoff notice law or Warn Act, post asset purchase issues

Maryland court enforces boilerplate forum selection clause in confidentiality and noncompetition agreement against spouse and related companies of signatory

Buyer is a group of related Maryland companies founded in 1976 and has its world headquarters in Taneytown, Maryland (an hour NW drive from Baltimore). Buyer provides service and makes products in the commercial HVAC, industrial process, power, and industrial

Posted in covenant not to compete, enforce against nonparty, forum selection clause, nondisclosure agreement

Buyer of Colorado restaurant assets stuck with seller’s higher unemployment tax rate liability even though buyer did not retain seller’s employees

Buyer began operating a restaurant in Palisade, Colorado (about 17 miles east of Grand Junction) after it acquired nearly all of the assets of Seller, which previously operated a different restaurant at the same location. Buyer acquired approximately 90% of

Posted in seller's unemployment experience rating, successor liability

Court permits seller of PR firm to sue buyer for lost earnout for allegedly taking actions that hurt target’s net earnings

Target was a privately held public relations firm based in Darien, Connecticut, 37 miles northeast of New York City. Buyer is a New York City based brand marketing and production studio. In August of 2016, Buyer purchased all of Target’s

Posted in earn outs

Sales rep can’t treat business asset sales proceeds as capital gain (personal goodwill) because rep did not own seller

Seller is based in Miami, Oklahoma (about a 90-mile NE drive from Tulsa). Seller was in the business of supplying soils, mulches and decorative stone to home-center and independent retailers. Taxpayer began working with Seller in the early 1990s. Taxpayer’s

Posted in personal goodwill, sale of assets of business

Court won’t enforce claimed oral modification of stock purchase agreement

Target is a San Diego, California late stage cell therapy company developing laboratory equipment and cell therapies to treat a variety of medical conditions.  Cell therapy is taking cells from a donor and putting them into a patient to treat

Posted in integration clause, no oral modifications of contract, waiver of contractual provision

Employee loses vested stock options upon sale of controlling interest in Employer

Employee is an executive with expertise in revenue cycle management and outsourcing phone calls and business processing services in the healthcare industry. Target is a Tampa, Florida based private company providing healthcare business outsourcing and knowledge process outsourcing services to

Posted in anti-destruction clause, implied covenant of good faith and fair dealing, stock purchase agreement, target's stock options

Non-compete given by business seller’s owner to business buyer in employment agreement held by court to be unenforceable

Seller’s owner is a computer programmer who operated Seller, a Portland, Maine based business that provided data and consulting services for the tire and automotive industry. In November 2010, Buyer contacted Seller’s owner about purchasing Seller. Buyer is based in

Posted in covenant not to compete, customer list, trade secret misappropriation

Court battles dense asset purchase agreement language to resolve dispute over severance payments made to former seller employees

Seller is one of the world’s leading manufacturers of over-the-counter pharmaceutical products, with headquarters in Allegan, Michigan. Buyer’s parent company (a subsidiary of a Dutch multinational company) manufactures vitamin and nutritional/dietary supplements and is based in Freehold, New Jersey. Seller

Posted in hiring seller's employees, overly complicated language in contract

Investment banker loses out on fee of target debt guaranteed by buyer of target stock

Investment Banker, based in Toronto, Canada, provides, among other things, investment banking advisory services relating to corporate transactions. Target is a New York-based company that provides asset-based lines of credit to small and medium-sized businesses on the eastern seaboard of

Posted in fee based upon buyer debt assumption, investment banker/business broker, success fee

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