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A “fraudulent conveyance” occurs when a debtor tries to avoid paying an unsecured debt by transferring property to another entity or person if the property is at risk of being seized by a creditor. In a Georgia appellate decision, a defendant LLLP appealed the lower court’s granting of an LLC’s motion asking to be substituted for the plaintiff in the lawsuit, as well as its motion for summary judgment denial. The defendant LLLP argued that the lower court had made a mistake in finding that the LLC had standing to recover under the Uniform Fraudulent Transfer Act (“UFTA”) claim.

The case arose in a trial of a different lawsuit. In that case, the court ordered the estate should specifically perform to buy the LLC’s stock from shareholders. A few months later the shareholders sued the estate, the LLLP and others asserting UFTA claims and asking for damages for fraudulent conveyances.

The plaintiffs claimed that a couple had created the LLLP in 2010 in order to transfer $5 million to the company with the goal of defrauding creditors. The couple asked for damages, including satisfaction of the $1.2 million judgment they’d been awarded. The plaintiffs argued that the UFTA allowed voiding of those transfers since they were made in order to defraud, delay or hinder the estate’s creditors (such as the plaintiff).

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For many years, lawyers and other scholars of contract law have spoken of a “meeting of the minds.” This refers to a state, sometimes called mutual assent, where there is a common understanding of an agreement’s terms between all of the parties. When there appears to be a meeting of the minds, but subsequent disputes potentially reveal otherwise, then it may require litigation to reach a resolution. Wherever you are in the process, it helps to a knowledgeable Georgia commercial contracts attorney to provide advice and representation to meet your need.

A recent case involving a dispute between a cold storage facility and one of its clients was an example of this issue of assent. The dispute arose after the grass and sod company noticed that some of its stored seed had been damaged by water and rodents, and notified the storage provider of the problem. The grass company eventually sent the storage provider an invoice for $9,625.

A week later, the storage provider sent the grass company a check, but it wasn’t for $9,625. The $275 check represented 50 cents for each pound of damaged product. The storage provider arrived at the 50-cents-per-pound rate based on a set of “Contract Terms and Conditions” that were printed on the reverse side of its warehouse receipt.

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Commercial litigation can take on many twists and turns. A skilled Georgia commercial litigation attorney can help you handle your dispute, whatever events take place. For example, in one recent case, which involved a contract dispute between a gas station and its petroleum supplier, the situation became more complex when the gas station filed for bankruptcy and “rejected” the parties’ contract.

The underlying contract that spawned this litigation made a Duluth-based distributor/supplier of petroleum the exclusive provider to a gas station in Suwanee. The contract also required the gas station to buy at least 60,000 gallons of product every month. The agreement additionally called for the distributor to pay the gas station a 2-cents-per-gallon rebate on each gallon the gas station purchased from the distributor Moreover, the distributor processed credit card payments for the gas station.

At a later point, the gas station fell behind on the payments it owed to the distributor. The distributor decided to take action by withholding credit card payments owed to the gas station and netting them out against the sums that it believed the gas station owed it. Along the way, the gas station declared bankruptcy. As part of that action, the gas station “rejected” the supply contract.

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When you are involved in commercial litigation, you might be faced with many possible challenges. As one example, what if you believe that your opposition flat-out lied to the court in order to obtain a favorable ruling? This is one example of the many possible unexpected events that may affect your case, and it illustrates why it pays to have experienced and skillful Georgia business litigation counsel handling your case.

A recent federal case that began in Atlanta involved allegations of this type. The underlying lawsuit was itself triggered by the defendant’s alleged deception. According to the complaint, a Pittsburgh-based cybersecurity company managed to download a 1,718-page file stored on a computer owned by an Atlanta-based cancer testing laboratory. The file allegedly contained several patients’ private identity information (like Social Security numbers) and personal medical information. The cybersecurity company, however, told the lab that it had discovered the file on the publicly available internet (specifically, a peer-to-peer filesharing site) and used that claim to try to solicit the lab as a client of its security services, according to the lab.

The lab sued the cybersecurity firm for computer fraud. The case started in state court in Fulton County but later moved to the federal District Court in Atlanta. That court eventually threw out the case because it decided that the cybersecurity entity didn’t have sufficient contacts with Georgia, and, as a result, the court here didn’t have jurisdiction over the defendant. Jurisdiction can be a very important piece of your litigation puzzle. If you are an Atlanta entity or individual, chances are that you’d rather litigate your commercial disputes in Georgia as opposed to some faraway state. However, it is important to make certain that the person or entity that you seek to sue has close enough ties to Georgia to allow you to bring your case here, or you risk having the judge dismiss your case.

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A ruling from the 11th Circuit Court of Appeals has clarified which legal responsibilities an issuer of stock has when it hires outside analysts to write glowing reviews of its stock. The federal appeals court in Atlanta upheld a lower court ruling in favor of the company and against a class of shareholders, stating that the company did not have an obligation to shareholders or potential shareholders to disclose its business relationship with the analysts. Since the company’s nondisclosure wasn’t improper, and its plan of hiring analysts to tout its stock wasn’t an illegal price manipulation scheme, that meant the shareholders had no basis for their lawsuit. Whether your shareholder dispute involves a well-established legal claim or an issue of law that is unsettled (as this one was), it pays to have experienced Georgia business attorneys representing you in your case.

The lawsuit was a class action launched by shareholders of a small pharmaceutical firm based in Norcross. The company made several stock offerings in 2013 and 2014. During that same time, the company retained multiple outside entities to promote or tout the value of the company’s stock as a good buy. The promoters published articles with headlines that urged “Investors Should Consider” the company’s stock (as a purchase). Several of the articles did not indicate anywhere within them that they were authored by companies hired by the pharmaceutical company itself. The goal was to pump up the company’s stock prices, but the stockholders in the lawsuit did not allege that the firm engaged in a “pump-and-dump” scheme.

After the firm’s stock promotion scheme was exposed by other analysts, however, its stock prices collapsed from almost $16 a share to just over $7 per share. The shareholders sued.

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One reason it is so important to secure legal counsel when entering into a business deal is to make sure that the language of a Georgia contract is as clear and unambiguous as it can be. There are several steps a court will take when interpreting the language of a contract during litigation if the language is not unambiguous and clear. In a recent Georgia appellate decision, Fannie Mae appealed from a lower court’s granting of an LLC and individual’s cross-motion for summary judgment and denial of a motion for judgment regarding its lawsuit asking for a deficiency judgment after confirmation of a foreclosure sale.

The case arose when an LLC refinanced a loan with HSBC in the principal amount of $12,500,00 and also executed a note in the company’s favor. Additionally, a guaranty was executed indicating that the key principal would have personal liability. An apartment building secured the loan, and this was described in a deed. HSBC endorsed the noted and assigned it to Fannie Mae.

Later, multiple businesses recorded materialman’s liens against the building securing the loan. The LLC admitted during discovery that it hadn’t paid or remediated the liens of several construction businesses within 30 days. It also didn’t make payments as required under the note’s terms and Fannie Mae foreclosed on the property in 2010. The court confirmed the foreclosure sale. The apartment building sold to the highest bidder for $5 million, more than its fair market value.

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When you are pursuing a commercial litigation action in Georgia, you might find yourself faced with many different types of arguments about why you should not be allowed to pursue your case. While some may relate directly to the facts of your case, others may have nothing at all to do with the underlying facts that led you into court. Whether the arguments against your case are factual, statutory, or procedural, it helps to have an experienced Georgia commercial litigation attorney on your side to make sure that your rights and interests are sufficiently represented and protected.

One case recently decided by the Georgia Court of Appeals involved a defense argument built on a specific statute:  Georgia’s Anti-SLAPP law. The seeds of the dispute dated back to 2015, when members formed a Cumming, Ga.-based LLC holding company to hold some 2,718 acres in Santa Rosa County, Fla. An additional entity was formed at the same time for the express purpose of serving as the managing member of the holding company. There were four entities that were members of that managing member LLC.

Less than a year later, allegations were made that several entities had breached the holding company’s operating agreement. Specifically, the allegation was that they hadn’t made required capital contributions, a claim they denied. Nevertheless, the manager LLC was voted out as the managing member of the holding company and replaced with a different LLC. The members of that new managing member then announced their intention not to develop the bulk of the Florida property but instead to donate it to the government of Santa Rosa County as a tax write-off.

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The zoning of a parcel can be a critical concern for a buyer when entering into a purchase and sale agreement. In a recent Georgia appellate decision, a buyer appealed from summary judgment in favor of the defendants regarding fraud in the sale of real property. The buyer argued that the question of fraud was one for the jury since the defendants had knowingly misrepresented the zoning and concealed the city’s intent to demolish the property and the buyer shouldn’t be charged with constructive knowledge of demolition orders that were brought outside the chain of title.

The appellate court affirmed the part of the lower court’s order granting the defendants summary judgment for their misrepresentations about zoning, but reversed the lower court’s order granting summary judgment to the defendants with regard to misrepresentations about the city’s planned demolition of the property.

In 2012, the bank (trustee for two loan trust entities) foreclosed on two real property parcels that were sold to the buyer. The city had zoned the property as Urban Rural – Historical Infill. The zoning prevented multi-family housing, and the parcels had been granted a legal non-conforming use status. The city planner believed that a property’s legal non-conforming use could be verified through completion of an Application for Zoning Verification that could be attained by the city.

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Your breach of contract case may start out looking seemingly straightforward to you, but it may still eventually come to have many unexpected twists. These may involve the facts of your case, the law, the rules of procedure, or all of the above, which is one reason among many why an experienced Georgia business litigation attorney can benefit the pursuit of your case. For example, one north Georgia business lost its bid to litigate a contract breach dispute in this state when the Georgia courts concluded that the more appropriate forum for the case was California.

The case began when a north Georgia business that produced training events for other businesses fell into a dispute with the California business it had hired to perform projects for it. Eventually, the California company decided to file a lawsuit in that state. The Georgia business sued here, alleging breach of contract and fraud.

The California company asked the Georgia court to throw out the case here on the basis of something called forum non conveniens. Forum non conveniens is a Latin phrase that translates to “forum not agreeing” and essentially means that a case should not be heard in a particular forum (location) because there is a forum elsewhere better positioned to handle the case.

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If you should find yourself in the position, as a judgment creditor, of needing to pursue an adversary proceeding against a Chapter 11 debtor, it is important to understand that there are many procedural rules involved in the process. While the courts may allow parties a bit of leeway because the law favors decisions made on the merits as opposed to procedural technicalities, some procedural flaws can have disastrous results. By working with a skilled Georgia creditors’ rights lawyer, you can make sure that you are doing everything possible to avoid falling into procedural pitfalls.

One example of a case in which a procedural imperfection led to considerable federal litigation was a dispute that arose between two business partners, Gary and David. In the 1990s, Gary and David developed a plan to establish a business that dealt in discount home improvement and building supplies. The plan seemed strong, but the business never took off. By 2007, with business still poor, Gary sued David, and David countersued. Eventually, in 2011, a jury ruled for David and awarded him damages in the amount of $318,025.

The next year, Gary filed for Chapter 11 bankruptcy. David sought to file an action within that bankruptcy, asking the bankruptcy judge to declare the damages award handed down a year earlier to be a non-dischargeable debt in accordance with 11 USC 523. The bankruptcy judge gave David until Oct. 12, 2012 to file a complaint and initiate an adversary proceeding under Section 523. However, David didn’t file a complaint and initiate an adversary proceeding, at least not at first. He filed a “Motion to Dismiss or for Determination of Non-Dischargeability of His Debt” prior to the deadline. Then, on Oct. 17, he filed an adversary complaint.

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