Tygon Peak Capital Management, LLC (“Tygon Peak”), a private equity firm, filed suit in Delaware Chancery Court against Voice Comm, LLC (“Voice Comm”) and its ownership group alleging breach of contract, unjust enrichment, breach of the covenant of good faith and fair dealing, deceptive trade practices, and defamation. (Verified Complaint, Tygon Peak Capital Management, LLC v. Mobile Investments Investco, LLC, No. 2019-0847 (Del. Ch. Oct 24, 2019)). The defendants in the suit include Voice Comm’s parent company, Mobile Investments Investco, LLC (“Investco”), the other firms that invested in Investco, and the individuals in charge of these investment companies who also sat on the boards of Investco and its subsidiaries. Id. Tygon Peak owns 100% of Investco’s Class A Units and 6.8% of Investco’s Class B Units and has a seat on Investco’s Board of Managers (“Investco’s Board”). Id. The suit arose after negotiations broke down over a potential buyout of Tygon Peak’s Investco stock. (Leonard, Bloomberg Law).
Read MoreStarting in December, large companies will be able to gauge investor interest in their potential initial public offering (“IPO”) in the same way smaller companies already do. (Ramonas, Bloomberg Law). The U.S. Securities and Exchange Commission (“SEC”) recently voted 5-0 to adopt new regulations under Rule 163B of the Securities Act of 1933 (“Securities Act”), which extend the rule’s “test-the-waters” provisions from emerging growth companies to all companies considering an IPO. (Id.) The ability to gauge institutional investor interest in a potential IPO will help companies better tailor the size and terms of their offerings to the demand of the market and allow companies to avoid the costs of pursuing an IPO if the interest is simply not there.
Read MoreLibra is a forthcoming cryptocurrency offered by the Libra Association, a Swiss non-profit formed by 28 investors, including Facebook’s subsidiary Calibra, Visa, Mastercard, and Uber. Each investor pledged $10 million to the project. (Murphy & Bond, Financial Times). Since the announcement of the coin in June, Facebook has been Libra’s principal cheerleader. (Id.)In that time, Libra has faced criticism over regulatory concerns, and even its claim of being a cryptocurrency. Libra is unlike other cryptocurrenciesin that the Libra Association will have authority over the coin. Where other cryptocurrencies have decentralized blockchain ledgers and are not issued by a central authority, the Libra Association will issue Libra and validate Libra-coin transactions. (Canellis, NextWeb).
Read MoreThe Strategic Hub for Innovation and Financial Technology (“FinHub”) of the Securities and Exchange Commission (“SEC”) released a framework for analyzing whether a contemplated sale of cryptocurrency, or tokens, is an “investment contract.” (FinHub Staff, SEC). The Securities Act of 1933 (“Securities Act”) and the Securities Exchange Act of 1934 (“Exchange Act”) both include investment contracts in their definition of securities. (15 U.S.C. §§ 77b(a)(1); 78c(a)(10)). If a cryptocurrency meets the requirements of an investment contract, it is a security subject to registration and regulation under the Securities Act and Exchange Act. The framework released by the SEC applies existing legal precedent to the cryptocurrency context. (FinHub Staff, SEC).
Read MoreBest known for its role in the rise of cryptocurrencies like Bitcoin, blockchain is a revolutionary technology that has the potential to transform how business transactions are conducted. For now, blockchain is primarily applied in digital financial transactions, like cryptocurrencies, but it presents a lot of opportunities for a wide variety of industries—from home entertainment to real estate to contract drafting —and beyond. This short article offers a brief introduction to blockchain, provides insight about its current uses, and summarizes some future applications.
Read MoreIn SEC v. Riel, No. 5:15-CV-1166 (MAD/DEP), 2017 BL 342140 (N.D.N.Y. Sept. 27, 2017), the United States District Court for the Northern District of New York granted in part and denied in part the Security Exchange Commission’s (“SEC”) motion for summary judgment against Charles Riel III (“Riel”), and granted the SEC’s motion for default judgment against REinvest, LLC (“REinvest”) (collectively “Defendants”), for Defendants’ violations of Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”), Rule 10b-5 thereunder, and Section 17(a) of the Securities Act of 1933 (“Securities Act”), and Riel’s alleged violations of Sections 20(a) and 20(e) of the Exchange Act, and Section 15(b) of the Securities Act.
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