Latest news with #Hellman
Forbes
27-04-2025
- Business
- Forbes
LIKE SWISS CHEESE: 14 EXCEPTIONS TO CHARGING ORDER EXCLUSIVITY
Charging order exclusivity is like Swiss cheese: Full of large holes through which creditors may ... More pass. A charging order is the American remedy by which a creditor may enforce a judgment against the interest held by a debtor in a limited liability company or partnership. A charging order has two components: First, a judicial lien is created in favor of the creditor against the debtor's interest; and, second, economic distributions to the interest are ordered to be paid to the creditor. The charging order ― which is to say the lien and order to pay ― continues to exist until the debtor has fully satisfied the judgment to the creditor. Most U.S. jurisdictions have adopted language in their LLC and partnership statutes which say that the charging order remedy is a creditor's exclusive remedy to satisfy a judgment against the debtor's interest. This is known as charging order exclusivity. But what does exclusive in this context mean really? There is a widely-held myth in LLC and partnership law that exclusive means something like outcome determinative, i.e., the creditor is stuck with a charging order and can get no further relief against the debtor's interest. This is false for, as will be shown below, there are at least fourteen (14) identifiable exceptions to charging order exclusivity. Moreover, it has long been held that the office of the charging order is not to protect the debtor's interest from creditors, but rather to protect the non-debtor members from being forced into what amounts to an involuntary business marriage with the debtor-member's creditors. With these exceptions, we will see that so long as the interests of the non-debtor members can be protected from the forced business marriage scenario, the debtor's interest is actually quite susceptible to being lost to creditors. For ease of analysis, this article will focus upon limited liability companies although the same analysis will usually apply to the various forms of partnerships. Also, because most U.S. jurisdictions have adopted some form of the Uniform Limited Liability Company Act ("ULLCA"), or at least a functionally-similar various of the ULLCA, we will focus upon the language of the ULLCA where applicable. And now, on to the exceptions! The first four exceptions are those found within the text of ULLCA 503 itself. They are thus known as the organic exceptions to charging order exclusivity. ULLCA 503(c) provides that if the creditor can show that distributions to the debtor-member's interest will not satisfy the judgment within a "reasonable" time, the court may order a judicial sale of the interest. What the purchaser at the judicial sale gets is determined by ULLCA 502, which means that the purchaser acquires the debtor's economic interest only. See, e.g., Hellman v. Anderson, 233 Cal. App. 3d 840, 284 Cal. Rptr. 830 ( 1991). However, this leaves the debtor without an economic interest in the LLC and normally causes the debtor to be disassociated from the LLC. Outcome: Debtor loses LLC interest, and the purchaser at the judicial sale becomes a mere assignee of the debtor's economic interest unless also admitted to the LLC. ULLCA 503(e) provides that prior to the foreclosure, either the LLC or the non-debtor members may purchase the interest by paying to the creditor the the full outstanding amount of the debtor-member's judgment. Practically, however, a creditor should almost be willing to accept the fair market value of the interest (and often much less). See, e.g., Eights & Jackson Investment Group v. Kaw Valley Bank, 2013 WL 183753 ( 2013). Outcome: Debtor loses the LLC interest, which is acquired by the non-debtor members. ULLCA 503(f) provides that the foreclosure of the charging order lien against the debtor-member's interest in a single-member LLC results in the purchaser at the judicial sale (usually the creditor via credit-bidding) becomes the new and only member of the LLC. The Comment to 503(f) states: "The charging order remedy—and, more particularly, the exclusiveness of the remedy—protect the 'pick your partner' principle. That principle is inapposite when a limited liability company has only one member. The exclusivity of the charging order remedy was never intended to protect a judgment debtor, but rather only to protect the interests of the judgment debtor's co-owners. Put another way, the charging order remedy was never intended as an 'asset protection' device for judgment debtors. See Olmstead v. F.T.C., 44 So. 3d 76, 83 (Fla. 2010) (recognizing 'the full scope of a judgment creditor's rights with respect to a judgment debtor's freely alienable membership interest in a single-member LLC'); In re Albright, 291 B.R. 538, 540 (Bankr. D. Colo. 2003) (holding that, '[b] Outcome: Debtor loses the LLC interest and the purchaser at the judicial sale will take in full the debtor's former interest and also take control of the LLC's assets. ULLCA 503(h) states that "[t] his section provides the exclusive remedy" by which a creditor can satisfy a judgment against the debtor-member's interest in an LLC. However, "this section" includes 503(b)(2) which allows a court to "make all other orders necessary to give effect to the charging order" and to "effectuate the collection of distributions". Thus, where distributions are not being made, the court may make "other orders" that force the making of that distribution. See, e.g., Earthgrains Baking Co., v. Sycamore, 2022 WL 433486 (10th Cir., Feb. 14, 2022) ("It is wrong to use [the exclusive remedy language] to read out of the statute broad language permitting a court to 'make all other orders necessary to give effect to the charging order.' [Citation omitted]. That language is crucial to the statute's procedural design and effectiveness, as this case illustrates."). This is perhaps the biggest hole in the charging order Swiss Cheese, albeit it is typically employed only in cases where the debtor, the LLC, or the non-debtor members have acted egregiously in derogation of the creditor's rights. Outcome: Distributions are forced to the debtor's interest subject to the charging order, including liquidation of LLC assets to accomplish this if necessary. The next five exceptions to charging order exclusivity occur because ULLCA 503 is determined for various reasons to not apply at all. Since charging order exclusivity is a creature of ULLCA 503, it simply disappears with these exceptions. These exceptions are thus known as the inapplicability exceptions. Comment to ULLCA 503: By its terms, this section does not apply to foreign limited liability companies. See Section 102(8) (defining "[l]imited liability company" to mean "an entity formed under this [act] or which becomes subject to this [act]") (emphasis added); see also Fannie Mae v. Heather Apartments Ltd. P'ship, A13-0562, 2013 WL 6223564, at *6 (Minn. Ct. App. Dec. 2, 2013) (considering the remedies available to a judgment creditor with respect to the judgment debtor's interest in a Cook Islands LLC; rejecting the debtor's argument that the creditor's "only remedy is to obtain a charging order under" [the Minnesota LLC statute]; explaining that "this argument fails because that statute only applies to Minnesota limited liability companies" which that statute "defines . . . as 'a limited liability company, other than a foreign limited liability company, organized or governed by this chapter'") (emphasis added) (statutory citations omitted). The operating agreement has no power to alter the provisions of this section to the prejudice of third parties. Section 105(c)(15). Note that recent changes to ULLCA, now being adopted by the states, will patch this loophole and make clear that foreign LLCs (including out-of-state LLCs) are subject to ULLCA 503. Outcome: A creditor may choose another remedy besides the charging order to enforce the judgment against the debtor's interest. Some states do not make the charging order the creditor's exclusive remedy. Even if the LLC is the formation state having charging order exclusivity, local judgment enforcement law may apply the law of the forum state without charging order exclusivity, thus allowing the creditor to employ another remedy. See, e.g., Bartch v. Bartch, 2024 WL 3560748 (10th Cir., July 29, 2024). Outcome: A creditor may choose another remedy besides the charging order to enforce the judgment against the debtor's interest. The Federal Debt Collection Practices Act (FDCPA), which controls judgment enforcement actions of the U.S. government, has been held to have supremacy as federal law over the contrary state charging order limitations. See, e.g., U.S. v. Wilhite, 2017 WL 5517410 ( Nov. 17, 2017); Consumer Fin. Prot. Bureau v. Integrity Advance, LLC, 2024 WL 5262916 ( Dec. 31, 2024). A similar result occurs with IRS collections. See, e.g., U.S. v. Driscoll, Case No. 18-11762 (D.N.J., Unpublished Opinion of Jan. 6, 2025). Outcome: A creditor may choose another remedy besides the charging order to enforce the judgment against the debtor's interest. Charging order exclusivity does not apply to a secured lender which is enforcing its security interest. The Comment to 503(h) states: "This subsection does not override Uniform Commercial Code, Article 9, which may provide different remedies for a secured creditor acting in that capacity. A secured creditor with a judgment might decide to proceed under Article 9 alone, under this section alone, or under both Article 9 and this section. In the last-mentioned circumstance, the constraints of this section would apply to the charging order but not to the Article 9 remedies." Note that charging order exclusivity should still exist where the creditor has exhausted its security interest and is only pursuing the deficiency. Outcome: The debtor loses the interest through foreclosure, and the purchaser at the judicial sale becomes a mere assignee of the debtor's economic interest unless admitted to the LLC. In a two-member LLC, members A & B get into a dispute and A gets a judgment against B. Since the purpose of charging order exclusivity is to protect the non-debtor member (and not the debtor member) should A's be limited to a charging order? Compare Voll v. Dunn, 2014 WL 7461644 ( Nov. 10, 2014) (unpublished) (no charging order exclusivity in intramember dispute), with Young v. Levy, 2014 WL 2741060 ( June 18, 2014) (Creditor-member's remedy still limited to charging order based on wording of statute even if it doesn't make much sense). Note that this issue can likely be resolved in the drafting of the Operating Agreement, although hardly anybody does that. Outcome: Depending upon state law, the non-debtor member/creditor may not be restricted to a charging order against the debtor/member's interest. The final five exceptions to charging order exclusivity arise from general judgment enforcement law. While these judgment enforcement vehicles would facially seem to be subject to charging order exclusivity, the courts through decisional law have carved out these exceptions. Note that at least two of these exceptions (voidable transaction and reverse veil-piercing) are also recognized by the Comments to ULLCA 503, so these exceptions should not be particularly surprising. This is different than the limited-purpose "informational" receiver found in 503(b)(1). Instead, the idea here is that the court may appoint a general receiver for the debtor-member which is all of (1) an officer and appendage of the court, (2) a trustee for the benefit of creditors, and, most importantly, the agent with power of attorney for the debtor. Thus, if a general receiver for the debtor-member then the receiver may exercise all rights possessed by the debtor-member, including voting to make distributions, dissolve the LLC or bring a derivative lawsuit to force distributions to be made. See, e.g., Gaggero v. Knapp, Petersen & Clarke, 2014 WL 5786609 ( Nov. 7, 2014) (Unreported). This is another large hole in the charging order Swiss Cheese, but general receivers are typically not appointed except where a debtor has acted egregiously to defeat the creditor's rights. Outcome: The general receiver may vote all the debtor's rights in the LLC, including to make distributions, to liquidate assets, to elect managers and new members to the LLC, and even to dissolve the LLC entirely (which would create a liquidating distribution to be paid to the debtor which would then be available to the creditor. If money has been fraudulently transferred by the debtor to an LLC (ostensibly in exchange for LLC membership interests), the creditor can maintain a case to avoid the transfer which, if successful, would render the LLC itself a debtor on the fraudulent transfer judgment. The creditor can then enforce the judgment directly against the LLC's assets in spite of charging order exclusivity. See, e.g., Comment to 503(h): "Likewise, this subsection does not supplant fraudulent transfer law." Outcome: LLC must pay the amount of the contribution that is avoided to the creditor which may require liquidation of some or all of the LLC's assets. Similar to a voidable transaction theory, a constructive trust is a creditor's remedy that is used when the creditor can trace money that was procured by wrongful means. In this scenario, a constructive trust is imposed over the recipient of the money, which would be the LLC. The LLC thus becomes liable for the money that it received, even if it was received in exchange for the membership interest. The same will be true for disgorgement orders and criminal restitution orders. See, e.g., Liberation Mgt. Satellite LLC v. Green, Appeal No. D083092 ( April 23, 2025) (criminal restitution order). Outcome: LLC must pay the amount of the contribution that is avoided to the creditor which may require liquidation of some or all of the LLC's assets. For creditors, the easiest and most expedient method of circumventing charging order exclusivity is by the employment of an alter ego theory, known in this context as "reverse veil piercing". Comment 503(h) states: "This subsection is not intended to prevent a court from effecting a 'reverse pierce' where appropriate. In a reverse pierce, the court conflates the entity and its owner to hold the entity liable for a debt of the owner. Litchfield Asset Mgmt. Corp. v. Howell, 799 A.2d 298, 312 (Conn. App. Ct. 2002) (approving a reverse pierce where a judgment debtor had established a limited liability company in a patent attempt to frustrate the judgment creditor), overruled on other grounds by, Robinson v. Coughlin, 830 A.2d 1114 (Conn. 2003). Likewise, this subsection does not supplant fraudulent transfer law." Outcome: The LLC is added to the creditor's judgment and its assets become liable for execution to satisfy the judgment. While this requires a very long explanation, suffice it here to say that there may be situations where the Bankruptcy Trustee may acquire, exercise management rights and liquidate the interests of an LLC in bankruptcy. That this is a very complex area of bankruptcy law is indicated by the fact that there have been approximately 20 court opinions relating to the issue of a debtor's LLC or partnership interest in bankruptcy ― and those opinions are all over the board. The root cause of this problem is that the current Bankruptcy Code was adopted prior to LLCs becoming popular entity planning tools and thus are required to be treated by provisions of the Bankruptcy Code (and most particularly BC § 365 relating to executory interests) which very poorly fit LLCs and partnerships. Outcome: In the worst case, the bankruptcy trustee may vote all the debtor's rights in the LLC, including to make distributions, to liquidate assets, to elect managers and new members to the LLC, and even to dissolve the LLC entirely (which would create a liquidating distribution to be paid to the debtor which would then be available to the creditor. The next time you hear somebody say that, "the creditor's only remedy is a charging order", you'll know that isn't true. Notwithstanding these exceptions, however, in most cases a creditor will be quite content to simply take a charging order and not seek to go further. The reason is that the charging order ties up the debtor's interest and deprives the debtor of the income stream thus helping to financially strangle the debtor. In connection with other remedies which similarly cut the debtor off from income streams, this alone can often be enough to bring the debtor to the table. Or, to alleviate the financial pain, the debtor will file for bankruptcy and the special powers of the bankruptcy court will end up cleaning the debtor out. But if a creditor needs to go further in attacking a debtor's LLC or partnership interest, there are a lot of arrows to be found in the creditor's quiver.
Metro
21-04-2025
- Business
- Metro
Cult US sauce finally lands in the UK — but some say it smells like 'PVA glue'
Move over mayonnaise, because Hellmann's is launching a brand new sauce in supermarkets — and it's one UK fans have been waiting for. Hellmann's Creamy Ranch is available in Tesco, after first announcing the news nearly a week ago, with an Instagram post seductively dunking a chicken tender in a pot of dressing on Instagram. It captioned the post: 'Sauce history has just been MADE.' While ranch is a popular condiment in the USA, dubbed 'bigger than ketchup', it's not quite such a big deal on shores, meaning Brits returning home from their American holidays have no choice but to pine for the creamy sauce from a-far. It's perhaps no surprise then that this new offering from Hellman's , which is also being launched with a Spicy Ranch variety, has caused quite the stir online. 'Oh man! I hope this is close to American Ranch! Every version I have here tends to taste a lot different,' wrote Lucy Brookes on Facebook. A bewildered American took to Reddit to share their dismay that ranch sauce isn't a big staple on UK supermarket shelves. 'Does the UK hate ranch sauce?' they wrote. 'I can't seem to find ranch sauce anywhere in supermarkets?' The poster continued: 'I'm shocked it's not popular enough to warrant it being stocked in the shops. Am I not looking hard enough or is there really no demand for ranch sauce in this country?' But prayers have now been answered, with many shoppers keen to give the American staple a whirl. 'Okay I need to get this,' wrote Instagram user @ on Hellman's announcement post, while another wrote: 'Oh lord, yes please.' But not everyone was impressed. 'Don't get your hopes up,' wrote Charrlotte Badgerr Bakerr on Facebook, who had already tested the Hellmann's sauces. 'Tried it today and quite disappointed. Smells a bit like PVA glue with a hint of garlic.' The Creamy Ranch is made with buttermilk and garlic, described as having a 'cool and tangy' flavour, while the spicy version swaps out the garlic for chillies, and is all about the heat. You can pick yourself up a bottle for just £2.60 or £2 if you've got a Tesco Clubcard. More Trending This offering could be also be a big hit for those searching for heat as the trend for spicier sauces continues, which has forced brands like Hellmann's to diversify their offerings. This has already led to the launch of a spicy mayo and Chilli Charger mayo, and now its Spicy Ranch is the latest addition to the gang. These are by no means the brand's most divisive offerings though. Back in 2022, it introduced Gravy mayo – a rich taste of gravy with creamy mayo, in a bid to unite the chippy tea preferences (gravy up north, mayonnaise down south) of the nation. Anyhow, you'll need to run, not walk, to scoop up Hellmann's new sauces at Tesco before they fly off the shelves. Do you have a story to share? Get in touch by emailing MetroLifestyleTeam@ View More » MORE: Aldi is finally bringing back its 'sell-out' sweet treat to shelves for just £1.79 MORE: Full list of supermarket opening times on Easter Monday including Tesco, Aldi and Morrisons MORE: Full list of supermarket opening times over Easter including Tesco, Aldi and Morrisons
USA Today
19-04-2025
- Sport
- USA Today
Oregon baseball captures Game 1 of key three-game series with UCLA
Oregon baseball captures Game 1 of key three-game series with UCLA More of this, please. Oregon Ducks starting pitcher Grayson Grinsell threw a two-hit complete game to lead the Ducks in a 2-1 victory over No. 12 UCLA Friday night at PK Park. Oregon is now 26-10 overall and 13-6 in Big Ten action. The Ducks are now a half game behind the first-place Bruins, who fell to 12-4 in league play. Grinsell's effort was just enough to propel the Ducks to victory. The only runs for Oregon came thanks to designated hitter Dominic Hellman's bat. The junior laced a single to left in the third inning to put the home team on the board 1-0. Then Hellman managed to add some much-needed insurance with a solo homer in the sixth. That home run turned out to be the game-winning shot as UCLA's shortstop Roch Cholowsky put the Bruins to within one run. But that was the only blemish on Grinsell's stat line. The Oregon left-handed ace finished with seven strikeouts and just one walk. UCLA's starter Wylan Moss was pretty good himself. He went five innings, giving up just one run on five hits and striking out three. He was followed by Chris Grothues' 2.2 innings and August Souza getting the final out in the eighth. Grothues struck out four, but the first batter he faced happened to be Hellman who took him deep. It might be a pitch Grothues might be thinking about for a while. This was just the first game of a crucial three-game set that had the feeling of a possible Super Regional. Both teams are ranked in the Top 15 and nearly equal in the Big Ten standings. Should Oregon sweep, which would be a tall task, the Ducks could have an inside track to winning the regular season in their first year in the conference. But there is a ton of baseball left to be played, including Game 2 of this series Saturday afternoon with first pitch scheduled for 2:05 pm.
Yahoo
07-03-2025
- Business
- Yahoo
OurBus considering launching bus service linking Reading to Philadelphia
A New York company is looking to fill a transportation gap left by the recent decision by Amtrak to discontinue bus service between Reading and Philadelphia later this month. OurBus, a business that specializes in providing intercity bus routes, announced this week that it is considering launching a bus route between the two cities. Officials said they are actively studying the possibility of establishing a replacement service that would include stops in Reading, Pottstown and 30th Street Station in Philadelphia. 'OurBus is currently assessing travel patterns and customer input before making a final decision to launch the service,' Axel Hellman, one of the two founders of the company, said in a press release. Hellman encouraged community members to provide their feedback and suggestions through an online survey at He said the information they gather from the survey will help determine departure times, days of operation and ticket prices. Hellman said OurBus is considering replacing the route and extending the service to another destination like Philadelphia International Airport, so that the service appeals to a larger audience. Hellman said a final decision about whether to launch the service will be announced by March 14. The announcement from OurBus comes after officials from Amtrak said last week that the company did an extensive evaluation of the route and found that ridership was too low to warrant continuing it. The service will end effective March 18. Amtrak launched the bus service between Reading and Philadelphia, with a stop in Pottstown, in June 2022. The service featured two daily round trips. Reading Mayor Eddie Moran said the potential service is a positive development. 'We're grateful to hear that OurBus is considering restoring the bus route between Reading and Philadelphia following the cancellation of Amtrak's Thruway service,' he said in a press release. The cancellation of the Amtrak bus service came as officials in Berks, Montgomery and Chester counties continue to work on a plan to restore passenger rail service between Reading and Philadelphia. The line would include stops in Reading, Pottstown and Phoenixville. Despite finding a possible solution to the bus service issue, Moran said he remains fully supportive of the return of rail service to Reading in the future.
The Guardian
04-03-2025
- Entertainment
- The Guardian
Memories of a Catholic Girlhood by Mary McCarthy review – incurable sadness if bravely borne
Mary McCarthy was a formidable, not to say frightening, figure in the literary landscape of mid-20th-century America, one of a cohort of remarkable left-leaning intellectuals that included Elizabeth Hardwick, Dwight Macdonald, Randall Jarrell and McCarthy's lifelong friend Hannah Arendt. The famous feud between McCarthy and the playwright Lillian Hellman – 'every word Hellman writes is a lie, including 'and' and 'the'' – led to a $2.5m libel suit brought by Hellman but which in the end damaged her own reputation beyond repair. McCarthy was already an established critic and fiction writer when, in 1963, she published The Group, the novel that was to bring her huge popular success. It is an account of the lives of a set of young women in postwar New York and, for its time, was frank to the point of being scandalous. Anyone reading it now will wonder what the fuss was about, given its bloodless psychologising and wooden prose. It could be argued that her finest book is Memories of a Catholic Girlhood, first published in 1957 and now reissued in a handsome paperback by Fitzcarraldo Editions. Much of the material had already appeared as autobiographical essays in the New Yorker, and in her preface here she expresses surprise that 'some readers… have taken them for stories'. This is somewhat disingenuous, since at the end of each of the eight sections of the book she examines her conscience, as a good Catholic girl should, and confesses to the parts of the preceding narrative that are 'made up'. She was born in Seattle in 1912, the inheritor of a 'salad of genes', as Nabokov would say, from her Irish Catholic, New England Protestant and California Jewish forebears. Both her parents died in the great influenza epidemic of 1918. Mary and her three brothers, including the future movie actor Kevin McCarthy, lived for a time with their father's Irish Catholic parents, a markedly unfeeling couple. Some of the most biting passages in the book deal with the grandmother: 'An aggressive churchgoer, she was quite without Christian feeling: the mercy of the Lord Jesus had never entered her heart.' Worse was to come, however, when the children were handed over to an aunt and uncle, a monstrous pair who made their lives a living hell. Among the many torments inflicted upon them was 'the adhesive tape that, to prevent mouth-breathing, was clapped upon our lips… sealing us up for the night, and that was removed, very painfully, with the help of ether, in the morning'. It should be noted that the ether was employed not as an anaesthetic, but as a lubricant, which left on the lips 'a grimy, grey, rubbery remainder'. McCarthy was grateful for her Catholic upbringing, particularly her convent education; as a Catholic, she notes, 'you have absorbed a good deal of world history and the history of ideas before you are twelve'. Later, she abandoned religion and became a sort of agnostic. She is disdainful of the squalid bargaining the church encourages: 'If the kind of God exists who would damn me for not working out a deal with Him… I should not care to spend eternity in the company of such a person.' Matters improved when the children's maternal grandfather listened to their tale of woe and set himself to rescuing them. The price, however, was the final break-up of the family: Mary went to live with Grandfather Preston, while the three boys were sent elsewhere. The four did not meet again until they were adults. Colm Tóibín, in his sympathetic and subtle introduction, notes the similarities between Mary McCarthy and the poet Elizabeth Bishop, both of whom grew up parentless, and used their orphanhood as literary material. Yet the biographies of both women bespeak an incurable sadness and a sense of damage, however bravely borne. McCarthy was the sprightlier and more feisty of the two, and in Memories of a Catholic Girlhood she made a small, or perhaps more than small, masterpiece. Sign up to Observed Analysis and opinion on the week's news and culture brought to you by the best Observer writers after newsletter promotion Memories of a Catholic Girlhood by Mary McCarthy is published by Fitzcarraldo Editions (£14.99). To support the Guardian and Observer order your copy at Delivery charges may apply
