JUUL SHAREHOLDER ALERT: REID COLLINS & TSAI LLP INVESTIGATING JUUL LABS, INC. FOR BREACHES OF FIDUCIARY DUTY
WILMINGTON, DE – August 9, 2024 – Reid Collins & Tsai LLP is investigating potential breach of fiduciary duty claims against current and former directors of Juul Labs, Inc. The transactions under investigation arise in connection with a recent investment by Juul insiders that enhanced their influence and control over the company at the expense of minority investors, whose stake in the company has been sharply diluted.
If you currently own shares of Juul and want to receive additional information free of charge so you can consider protection of your investment, please get in touch by contacting William T. Reid, IV, Esq. by email (wreid@reidcollins.com) or by phone (512-647-6100).
REID COLLINS SUCCESSFULLY RESOLVES PARTNERSHIP DISPUTE INVOLVING EMERALD LAKE CAPITAL MANAGEMENT FOLLOWING TWO-WEEK ARBITRATION
Reid Collins represented Carling O’Brien, a former partner and co-founder of Emerald Lake Capital Management, in an arbitration proceeding against Emerald Lake, Dan Lukas, and others. O’Brien alleged that Lukas improperly terminated her for cause in a bad-faith scheme to confiscate her valuable partnership stake and carried interest grants. The Reid Collins team, led by Managing Partner Lisa Tsai and Ryan Goldstein, tried the case in a two-week arbitration hearing in Los Angeles in August and September 2023. After the three-judge panel issued an Interim Decision in March 2024, the parties successfully settled their dispute on confidential terms in May 2024.
See complaint here.
See WSJ story here.
REID COLLINS & TSAI DEFEATS MOTION TO DISMISS LEGAL MALPRACTICE LAWSUIT AGAINST MORRIS, MANNING & MARTIN RELATED TO FIP PONZI SCHEME
- Nationally renowned business litigation and trial firm Reid Collins & Tsai LLP leads prosecution of legal malpractice action against Atlanta-based law firm Morris, Manning & Martin, LLP.
- Court ruled that matter will proceed against Morris Manning.
- Reid Collins is one of the nation’s leaders in legal malpractice claims, with significant experience successfully prosecuting major national and regional law firms for claims related to a variety of professional misconduct and negligent advice.
Reid Collins & Tsai LLP (“Reid Collins”) obtained a major victory in a legal malpractice action related to a $310 million nationwide Ponzi scheme that exploited military veterans in desperate financial straits and targeted elderly investors seeking a safe retirement investment. The lawsuit arises from flawed legal advice provided to Future Income Payments LLC (f/k/a Pensions, Annuities, and Settlements, LLC) (“FIP”) by Atlanta-based law firm Morris, Manning & Martin, LLP (“Morris Manning”). The action alleges that errors in the legal analysis of Morris Manning’s lead partner and ongoing conflicts of interest in the firm’s representation materially contributed to the collapse of FIP and hastened the descent of its business model from a viable financial platform assisting retirees and military veterans to a Ponzi scheme seeking to avoid collapse.
On April 30, 2024, the South Carolina federal court denied Morris Manning’s motion to dismiss based on a statute of limitations defense, ruling that the case should proceed to discovery.
Background
FIP was a fast-growing company in a controversial but potentially profitable space. Founded in 2011, FIP provided lump-sum cash advance payments to seniors and military veterans in exchange for future pension payments. The business model held risks: characterized as loans, the financial transactions might violate state usury laws against excessive interest rates (as had happened to a competitor firm in California); characterized as assignments or transfers, they might violate federal laws against assigning or alienating pensions.
As alleged in the action, FIP sought to accelerate its growth and avoid legal setbacks, considering changes to its business model to instead connect pensioners with investors who would acquire those future pension payments. FIP would act as a middleman receiving fees for servicing and administrating those transactions. FIP retained James Maxson, a Morris Manning partner, to, among other things, evaluate and opine on FIP’s proposed structure change and identify any potential issues. Maxson delivered a memo on Morris Manning letterhead presenting a conclusion that it was “unlikely” a court would deem the proposed investment transactions to be “investment contracts” requiring registration or exemption under the federal securities laws and failing to identify fundamental flaws in FIP’s structure.
In addition, Maxson and Morris Manning went on to represent FIP despite a substantial ongoing conflict of interest in their representation of various entities controlled by Maxson’s client Benjamin Geber which stood to profit through FIP commissions only if Morris Manning blessed FIP’s new business model. As FIP’s outside general counsel from 2012 through its collapse in 2018, Maxson knew the business intimately and drafted and reviewed FIP legal documents and marketing materials which were used to secure investors, but failed to disclose the regulatory risk FIP faced, the conflicts of interest in its structure, and other material issues.
The deficient and conflicted legal advice propelled FIP toward numerous enforcement actions by state agencies and attorneys general, and ultimately, company-destroying liability for mail, wire, and securities fraud. Maxson departed Morris Manning in January 2015 but continued representing FIP until it ceased operations in April 2018, leaving investors victimized by the scheme owed approximately $310 million. Though FIP collapsed under massive civil and criminal liability, Morris Manning kept its legal fees.
Reid Collins represents Beattie B. Ashmore, the court-appointed Federal Receiver for the FIP Receivership Entities. The case is captioned Beattie B. Ashmore, a Receiver for the FIP Receivership Entities v. Morris, Manning & Martin, LLP, Civil Action No. 6:23-cv-04592-BHH (U.S.D.C. District of South Carolina).
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