We recently posted about the risks associated with veil-piercing claims and the ways in which fund managers can protect themselves from exposure to these claims. Our first post on veil-piercing focused on Delaware standards,...more
10/2/2017
/ Alter Ego ,
Choice-of-Law ,
Corporate Veil ,
Fund Managers ,
Internal Affairs Doctrine ,
Investors ,
Personal Liability ,
Piercing the Corporate Veil ,
Portfolio Companies ,
Shareholders ,
State of Incorporation
A veil piercing claim can be a worst-case scenario for a private fund manager dealing with a struggling portfolio company investment – the company fails, and ensuing legal claims are brought not only against the portfolio...more
9/21/2017
/ Alter Ego ,
Choice-of-Law ,
Corporate Fraud ,
Corporate Veil ,
Fund Managers ,
Internal Affairs Doctrine ,
Investors ,
Limited Liability Company (LLC) ,
Personal Liability ,
Piercing the Corporate Veil ,
Portfolio Companies ,
Private Funds ,
Risk Management ,
Risk Mitigation ,
Shareholder Litigation ,
WARN Act
For private fund managers, the valuation of privately-held securities has been subject to heightened regulatory scrutiny. As the IPO on-ramp for private “unicorn” investments has lengthened, fund managers may hold illiquid...more
6/21/2017
/ Fund Managers ,
Initial Public Offering (IPO) ,
IRS ,
Portfolio Managers ,
Private Equity ,
Private Funds ,
Privately Held Corporations ,
Section 409A ,
Securities and Exchange Commission (SEC) ,
Unicorns ,
Valuation
According to recent news reports, the DOJ and the SEC are investigating the possible improper use of third-party broker quotes by hedge fund managers to value illiquid debt securities in their portfolios. Prosecutors are...more
6/1/2017
/ Bonds ,
Brokers ,
Criminal Investigations ,
Debt Securities ,
Department of Justice (DOJ) ,
Fraud ,
Fund Managers ,
GAAP ,
Hedge Funds ,
Misleading Statements ,
Municipal Bonds ,
Securities and Exchange Commission (SEC) ,
Valuation
As we have previously observed, private fund advisers face a difficult challenge when SEC guidance (in the form of a speech or a public enforcement order) indicates that certain long-standing practices may be contrary to the...more
6/28/2016
/ Anti-Retaliation Provisions ,
Dodd-Frank ,
Fund Managers ,
Internal Investigations ,
Internal Reporting ,
Investment Adviser ,
Private Funds ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Whistleblower Awards ,
Whistleblowers
On June 1, 2016, the SEC announced a settlement with Blackstreet Capital Management, LLC and Murry N. Gunty, Blackstreet's managing member and principal owner. As a registered investment adviser based in Chevy Chase,...more