Last month, this Blog wrote about McGowan v. Clarion Partners, LLC , a decision involving the enforceability of a transaction term sheet. In McGowan , Justice Scarpulla of the New York County, Supreme Court, Commercial Division, held that the term sheet before the court was a binding contract because it contained all the material terms of the proposed venture that would reasonably have been expected to be included under the circumstances. This month, by contrast, Justice Sin

On the same day that he signed a directive ordering a review of the Labor Department's fiduciary rule (discussed here ), President Trump signed an executive order directing the Treasury Secretary and other regulators to review existing regulations to determine whether they support six core principles. Included in those principles are: Empowering Americans to make independent financial decisions; Fostering economic growth through more rigorous regulatory impact analysis; Advan

In this Blog’s last entry , we discussed the advantages and disadvantages of forming a limited liability company (“LLC”). Today’s entry discusses whether non-managing members of a manager-managed LLC owe fiduciary duties to the other LLC members and to the LLC itself. An LLC is a hybrid business entity having the attributes of both a corporation and a partnership. E.g. , Willoughby Rehabilitation & Health Care Ctr., LLC v. Webster , 2006 NY Slip Op. 52067(U) (13 Misc. 3d 123

New business owners have many decisions to make when they start a business. Many of these decisions will impact the business for years to come. Among them is the correct type of business to form. One of the most common business forms used by entrepreneurs is the Limited Liability Company (“LLC”). While LLCs share many of the same attributes as an S-Corporation or C-Corporation, they are more flexible and require less formalities and paperwork. An S-Corporation (formerly kno

In February, the Royal Bank of Scotland was hit with a $85 million civil penalty by the U.S. Commodity Futures Trading Commission ("CFTC") in connection with the bank's attempted manipulation of a benchmark tied to U.S. dollar based swap transactions over a five-year period from January 2007 through March 2012. The commodities watchdog found that RBS bid, offered and executed transactions that were pegged to the U.S. Dollar International Swaps and Derivatives Association Fix

The Anti-Retaliation Provisions of The False Claims Act: The decision to blow the whistle is not an easy one to make, especially when the person blowing the whistle does so on his/her employer. A person’s career, financial security, reputation and sometimes personal safety can be at risk. This is true whether the person worked for the company that is the subject of a potential whistleblower (or “qui tam”) action. Recognizing the risks, Congress amended the False Claims Act (

The enforceability of a covenant not to compete is an issue that commercial and business lawyers often consider in their practice. Sometimes, the issue arises when an employee leaves a business to open his/her own shop, while other times the issue arises in the sale of a company. On January 18, 2017, in Shimon v. Paper Enterprises, Inc. , 2017 NY Slip Op. 30101(U) , Justice Sylvia G. Ash of the Supreme Court, Kings County, Commercial Division, issued an injunction enforcing

Last month, this Blog wrote about the uncertainty surrounding implementation of the Department of Labor’s (“DOL”) fiduciary rule. On February 3, 2017, that uncertainty was reinforced with the issuance by President Trump of a memorandum directing the DOL to determine whether the fiduciary rule should be revised or rescinded. The memorandum directs the DOL to delay the implementation date of the rule by 180 days. What is the Fiduciary Rule? The regulations in question expande

Arbitration is an alternative dispute resolution mechanism that enables parties to resolve disputes without going to court. Arbitration is similar to a trial without the formalities. It is an adversarial proceeding where the parties can call witnesses and present evidence to a neutral arbitrator or panel of arbitrators. The rules of discovery and evidence are relaxed to make it a shorter and more cost-efficient process. An attorney or retired judge, who works for a private A

New York, NY ( Law Firm Newswire ) February 3, 2017 - The Law Office of Jeffrey M. Haber is pleased to announce that Mr. Haber, the firm’s principal, has been published in the December 2016 edition of the Wall Street Lawyer (Vol. 20, No. 12), a West LegalEdcenter publication, ©Thomson Reuters. The article, entitled “Will the Public Disclosure Bar Be the Next Provision of the False Claims Act to Be Reviewed by the U.S. Supreme Court?”, covers the basics of the False Claims A

Last year, the Appellate Division, Second Department, affirmed and modified in part a post-trial judgment against a former minority partner who wrongfully dissolved a general partnership. Congel v. Malfitano , 141 A.D.3d 64 (2d Dep’t May 18, 2016). In a case of first impression in the Department, the Court found that, under Partnership Law § 69(2)(c)(II), a “minority discount” may be applied to the valuation of a minority partner’s interest to reflect the lack of control the

Call centers are nothing new to consumers. Businesses, both large and small, use them to handle their telephone communications with new and existing customers. Brokerage firms also use call centers to service some of their customers – usually those customers with accounts having less than $100,000 - $200,000 in assets. Some firms use financial advisory centers (“FAC”) to provide support for a variety of administrative and customer service issues, while others use call cente

What does the SEC have planned for investment advisers and brokers dealers? The Securities and Exchange Commission ("SEC") recently released its list of examination priorities for 2017. In particular, the SEC will be focusing on three areas: matters of importance to retail investors, risks to elderly and retiring investors, and market-wide risks. There are 21 areas of focus on this year's list, including: Money market funds Representatives and employers with prior records of

Parties to commercial/business transactions are no doubt familiar with “term sheets”, “letters of intent”, “memoranda of understanding” and “agreements in principle”. As the parties to these documents know, they outline the fundamental terms of the transaction being negotiated. Terms sheets and the like have a number of advantages: they can be drafted without the expense of hiring a lawyer; they reduce later renegotiation and lapses in memory; they can facilitate discussions

Last year, this Blog wrote a number of articles about the Securities and Exchange Commission’s (“SEC” or the “Commission”) efforts to stop companies from impeding whistleblowers from reporting violations of the securities laws to the Commission. ( See here , here , and here .) It looks like 2017 is picking up where 2016 left off. Last week, the SEC announced the settlement of two enforcement actions ( here and here ) against companies that impeded protected whistleblower ac

On January 23, 2017, the SEC announced that it awarded more than $7 million to three whistleblowers who came forward with information that led to a successful SEC enforcement action. One whistleblower provided information that the SEC considered to be the primary impetus for the start of the Commission’s investigation. Consequently, the SEC awarded more than $4 million to that whistleblower. The other two whistleblowers split more than $3 million for jointly providing new

In December 2016, UBS lost an $18.5 million arbitration brought by two former clients, a husband and wife, in connection with the sale of close-end funds that were collateralized by Puerto Rican bonds. The controversy arose in the wake of the collapse of the island nation's bond market in 2013 during which time UBS allegedly increased the local demand for the bonds artificially and misled the clients about the potential risks associated with the investments. In 2014, the cou

Being a whistleblower is not easy. It involves personal sacrifice and professional risk. Many violations of the law go unreported, especially in the workplace, because people who know about them are afraid of being disciplined, losing their job, being demoted, or being passed over for promotion. Recognizing the financial, reputational and professional risks associated with whistleblowing, Congress included in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 20