Section 546(e) of the bankruptcy code prohibits a bankruptcy trustee from avoiding “settlement payment[s]”, or payments “made in connection with a securities contract,” that are “made by or to (or for the benefit of)” qualifying financial entities, including financial institutions, stockbrokers, commodities brokers and others. In a ruling that conflicts with precedent from the Second, Third, Sixth, Eighth, and Tenth Circuits, a decision last week by a Seventh Circuit panel held that the safe harbor provision of section 546(e) does not preclude a trustee from recovering a transfer to a party that was not a qualifying financial entity, where a qualifying financial institution was merely the conduit for the transaction. See FTI Consulting v. Merit Management Group, LP.
Jim Anderson is a litigator and trial lawyer. His practice focuses on complex commercial litigation involving leading technology and pharmaceutical companies, as well as private equity, private credit, and venture funds. Jim leverages his technological background and expertise to represent clients in high-stakes business and intellectual property disputes.
Jim has experience litigating cases for clients in the life sciences, biotech, software, consumer electronics, and financial services industries. Jim has also handled lawsuits for venture and hedge funds, and real estate clients. He has litigated cases in courts throughout the United States, as well as before the International Trade Commission and Patent Trial and Appeal Board. He has also represented foreign and domestic companies in disputes before international arbitration tribunals under ICC and CPR Rules.
In addition to his commercial litigation practice, Jim counsels and advises private equity and private credit clients in fund-fund, lender-sponsor, and portfolio company disputes. Jim leverages his courtroom experience to help these clients navigate regulatory and litigation risks.
Jim also advises clients on intellectual property strategy spanning the full range of patent, trademark, and trade secret protections. He has developed and maintained intellectual property portfolios in a broad range of industries, including consumer products, medical devices, machining and fabrication equipment, and semiconductor devices. Jim is registered to practice before the USPTO.
Jim also maintains an active pro bono practice. He has received awards for his work on behalf of victims of domestic violence and abuse.
Jim has a background in Mechanical Engineering, with a focus on energy, power, and fuel cell technologies. Prior to his career at Proskauer, Jim served as a judicial intern in the U.S. District Court for the District of Connecticut and represented clients with the UConn Intellectual Property and Entrepreneurship Law Clinic.
The New York Court of Appeals has followed Delaware in holding that the business-judgment rule applies to going-private mergers as long as certain shareholder-protective measures are met. The court’s May 5, 2016 decision in In the Matter of Kenneth Cole Productions, Inc. Shareholder Litigation, Case No. 54, adopts the standard set forth by the Delaware Supreme Court in Kahn v. M & F Worldwide Corp., 88 A.3d 635 (Del. 2014) (“MFW”), and relaxes judicial scrutiny of controlling shareholders’ going-private mergers if the transactions provide certain protective conditions to safeguard the interests of minority shareholders.