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Author: Mark J. Loewenstein & Jay Geyer
Download a copy here.
Cryptocurrency, like any investment, carries risks. For one, there is the risk that the cryptocurrency decreases in value.[1] There is also a risk of more fundamental issues: the issuer misrepresenting material aspects of the cryptocurrency[2] or even simply running away with investors’ money.[3] For these issues, most investment products have well established legal remedies.[4] For example, an issuer who makes a material misrepresentation to investors about a security could, under federal securities laws, face private litigation.[5] For cryptocurrency investors, however, the scope of legal recourse available is not often clear.[6] This is the case because it is not often clear…
For many insurance companies, 2020 started off strong following favorable financial results in 2019.[1] Unfortunately, reality soon set in and the market took a deep tumble with the outbreak of the COVID-19 global pandemic.[2] The pandemic exasperated an already strained marketplace following tough years of catastrophic loss activity in the property and casualty space[3] along with rampant Directors & Officers (D&O) event driven litigation.[4] Overall, Insurer profitability is not expected for most of 2021,[5] which is bad news for insureds. 2020 was a difficult year for many insurers and insureds, and unfortunately 2021 doesn’t look much better for the insurance…
In 2019, Congress passed the Small Business Reorganization Act which created a new subchapter of the Chapter 11 bankruptcy code called Subchapter V specifically for small businesses.[1] Lawmakers aimed to provide “a better path for small businesses to successfully restructure, reduce liquidations, save jobs and increase recoveries to creditors” by creating Subchapter V.[2] In February of 2020, Subchapter V became effective just before a national health crisis that catalyzed significant economic distress[3] especially for small businesses.[4] Since then, many Chapter 11 cases have petitioned the courts to change from Chapter 11 to Subchapter V because of the significant benefits associated…
By now, whether through social media memes or reputable news sources, you have probably read about the recent proletariat-like invasion of the retail investor on Wall Street.[1] Perhaps you only know the event as that thing that happened to GameStop; or perhaps, like me, you realized something was going on after receiving various emails from places where you hold accounts, like Robinhood or TD Ameritrade, attempting to dissuade worry about the market’s volatility and their role in the event’s fallout. Regardless of how your awareness of the events came about, it is highly likely that reading headlines raised more questions…
The year of SPACs In 2020 the SPAC boom seemed to be on everyone’s lips,[1] marking a record number of IPOs.[2] Sponsors came from a plethora of backgrounds and included activist investor Bill Ackman,[3] former speaker of the House Paul Ryan,[4] former director of the National Economic Council Gary Cohn,[5] and former basketball player Shaquille O’Neal.[6] While Blank Check Companies can be traced back to 18th century England and the South Sea Bubble,[7] the SPAC investment vehicle emerged in modern financial markets in August 2003 by asserting itself as a new asset class.[8] In the U.S., 248 SPACs went…
Raising Capital in Time of Pandemic: An Alternative for Small Businesses[1] The impact of the COVID-19 pandemic has been severe on the economy and has been felt disproportionately by small businesses.[2] A recent study found that about 800 small businesses a day are forced to close across the country during the pandemic.[3] Another survey found that only 34% of small business owners claim that their operations are currently profitable as compared to 55% at this point in 2019.[4] And with winter, and a rapidly unfolding second wave of the pandemic, the crisis will only continue to get worse as more…
In a novel move in the debt collection industry, the Consumer Financial Protection Bureau (CFPB) issued a final rule[1] regulating the scope of the Fair Debt Collection Practices Act (FDCPA).[2] The first part of this rule, issued on October 30, 2020, provides long-awaited clarification on how and when debt collectors may communicate with consumers.[3] The FDCPA was enacted in 1977 with the intention of “eliminat[ing] abusive, deceptive, and unfair debt collection practices.”[4] Today, over 8,000 debt collection firms amass a multibillion dollar industry.[5] All the while, the capacity and functions of technology have expanded, and court opinions have provided different…
As COVID-19 wreaks havoc on our world, important shifts in corporate governance practices continue to emerge, especially as companies are forced to create new business models and tackle novel problems in order to stay afloat.[1] Boards of directors are increasingly, and necessarily, called upon to enhance existing risk and cash management efforts as companies face unparalleled challenges with employee health, social distancing requirements, and supply chain disruption.[2] It is important to note that many of these governance shifts are not solely the result of the COVID-19 pandemic;[3] rather, shifting corporate governance strategies arise in both historic instances of market unrest,…