Monthly Archives: October 2019

Buyer to Indemnify Business Seller for 3rd Party Asbestos Claim Punitive Damages

Introduction Liability for asbestos claims is a common risk with manufacturing companies. Sophisticated buyers and sellers of manufacturing businesses are aware of the risk and usually manage it through an allocation between the buyer and the seller in the acquisition

Posted in asbestos claims, indemnification, punitive damages Tagged with: , ,

Business Buyer’s Suit Against Seller is Hampered by Missing Due Diligence Binder

Introduction Buying a company has many legal risks for a buyer. One of the most important tools to manage the risks of buying a business is to conduct a thorough due diligence investigation of the company. The deal This case

Posted in preservation of due diligence materials Tagged with: , , ,

Forum Selection Clause Enforced in Buyer Note Given in Acquisition of Company

Introduction A buyer of a company wants the purchase agreement to specify that a post-closing dispute will be litigated in a state or country convenient to it. Often both sides can agree that the most convenient forum is where the

Posted in forum selection clause Tagged with: ,

Court Holds That Business Buyer Probably Acquired Founder’s Publicity Rights

Introduction The exclusive right to use the founder’s name, likeness and goodwill in connection with the marketing and sale of the founder’s business may be a very valuable asset. And if it is, the buyer may want to acquire the

Posted in personal goodwill, Right of publicity Tagged with: , , , ,

Fraud Carve-Out in APA’s Exclusive Remedy Provision Saves Buyer’s Employee Non-Solicitation Claim

Introduction Most acquisition agreements provide that the agreement’s indemnification provisions are the exclusive remedy for a contractual breach. However, it is also common to exclude fraud claims from this exclusive remedy provision. The deal This deal involved the acquisition of

Posted in boilerplate provisions, fraud carveout, hiring seller's employees, nonsolicitation of employees and customers Tagged with: ,

Business Buyer Brings Employee Raiding Suit Against Key Seller Employee

Introduction The value of a service business may be its employees. A major risk in an acquisition may be a mass exodus of key seller employees after the closing. The deal Here, the seller was an investment research firm. The

Posted in employment agreement, hiring seller's employees, key employees of target, nonsolicitation of employees and customers, stay bonus Tagged with: ,

Business Buyer Sues Key Former Seller Employee for Using Seller Business Cards

Introduction A key employee in a service business may have valuable personal relationships with the company’s clients. A buyer of the service business risks the key employee walking out the door with company clients after the closing. The deal Here,

Posted in business cards, trade secret misappropriation by former seller employee Tagged with:

Buyer May Pay $1.2 Million Twice for Seller Assets Subject to Financing Statement

Introduction One of the legal risks when purchasing a business is purchasing assets that are collateral for a loan. The deal This is a follow up to a deal where the buyer purchased the assets of a seller that made

Posted in due diligence, liens, UCC search Tagged with: , ,

Buyer’s Section 363 Purchase of Bankrupt Hospital Assets Is Free of Medi-Cal Liabilities

Introduction A principal reason for buying the assets of a distressed business out bankruptcy is to purchase the assets free and clear of liabilities under Bankruptcy Code Section 363. The deal In this case the buyer agreed to purchase the

Posted in bankruptcy sale, distressed business acquisitions, executory contracts, Medi-Cal provider agreements, Section 363 sale Tagged with:

Medical Practice Buyer Sues Selling Doctor for Post-Closing Taking of Patient List

Introduction A patient list may be a valuable and confidential asset of a medical practice. Therefore, a buyer of a medical practice will want to keep the selling doctor from taking the patient list with him or her after the

Posted in trade secret misappropriation, trade secret misappropriation by former seller employee Tagged with:

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