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Tampa Business & Commercial Law Blog

Business litigation over marketing strategy settled

A Florida business may spend a great deal of time developing a marketing strategy that will help it sell its products or services. In doing so, a business may inadvertently infringe on a trademark or patent belonging to another business. This could result in timely and costly business litigation being filed against the company.

An outdoor apparel company sells shirts referred to as "Henleys," which are half-button, pullover shirts with no collars. The company developed an advertising campaign to sell these shirts. The slogan was "Don a Henley and Take It Easy." This may seem clever, but without receiving permission to use the name of the founder of the popular music group, the Eagles -- Don Henley -- and the name of one of the group's songs, the company opened itself up to litigation.

Business litigation against a lender could halt foreclosure

Nearly everyone in Florida has heard about the "robo-lending" scandal that led to several lenders negotiating settlements to repay borrowers. These cases highlighted just some of the issues plaguing the personal and commercial lending industry. When these problems came to light, many home and business owners facing foreclosure initiated business litigation against their lenders in response to foreclosure filings.

Many Florida companies take out a mortgage loan in order to purchase the property out of which the business is run. If it becomes difficult to make payments on the mortgage loan, a lender may begin foreclosure proceedings. In some cases, the lender failed to meet both state and federal requirements in making the loan, and the borrower may have a claim for lender liability.

LightSquared emerges from Chapter 11 bankruptcy

Many Florida readers are unfamiliar with the company LightSquared or the most valuable asset that the entity owns, which is known as wireless spectrum. However, virtually everyone has become accustomed to the service that wireless networks provide, and many people make use of various forms of wireless technology on a daily basis. The company went into Chapter 11 bankruptcy in 2012, but recently received approval to end the case and repay its largest creditor.

The bankruptcy case has received a great deal of media attention due to the insistence of Dish Network Chairman Charles Ergen that the debt that LightSquared owed to him be paid in full. That debt was listed at nearly $1 billion. As part of the bankruptcy settlement, Ergen will receive that amount, plus an additional half a billion in interest.

Merger between grocery retail giants is scrutinized by the FTC

When two giant corporations in the same retail field propose a merger, the Federal Trade Commission (FTC) must approve the deal. A main concern of the FTC in these matters is that the new entity not turn out to be a monopolistic enterprise that is capable of snuffing out any competition. Nationally, including in Florida, federal antitrust laws do not favor a merger that will be monopolistic, because a monopoly could lead to higher prices, decreased quality, and stifled economic growth.

A proposed merger of two massive grocery retailers, Albertsons and Safeway, is a merger that the FTC has extensively monitored and regulated, prior to final approval of the deal. One of the ways in which the FTC manages the consummation of a merger is by requiring the two companies to sell off, or divest, themselves of a certain number of stores. These must be sold to other retailers so that competition and competitive pricing will be protected.

Bank merger will increase Seacoast Banking Corp.'s holdings

Federal Deposit Insurance Corp. records indicate that Seacoast Banking Corporation (Seacoast) currently serves Florida residents at 48 Seacoast National Bank locations. Seacoast recently announced that it is increasing that number through a merger with three Grand Bank & Trust of Florida branches currently owned by Grand Bankshares, Inc. (Grand). Current Grand customers will ultimately have access to all of the services offered by Seacoast.

When Seacoast takes control of the branches, its assets will increase by approximately $207.8 million. The bank will also receive net loans and leases valued at nearly $123.3 million, deposits of approximately $184.6 million and repossessed properties of around $8.2 million. Seacoast is expected to purchase Grand's three branches with a combination of cash and stock. The estimated value of the transaction is $16.2 million, which represents around 77 percent of the last reported value of Grand's Tier 1 capital.

Dispute resolution ends in almost $150M settlement by Duke Energy

Duke Energy holds the distinction of being the largest electric company in the United States with over seven million customers across six states, including Florida. However, that did not stop several of the company's shareholders from filing a lawsuit against it after its buyout of Progress Energy Inc. in July 2012. Recently, dispute resolution efforts resulted in a settlement whereby Duke Energy will pay out somewhere around $150M to its shareholders.

The lawsuit was filed in the wake of the termination of the company's CEO within hours of when the buyout was finalized. Shareholders claim that Duke Energy made certain misrepresentations regarding the terms of the buyout. Even though the electric company has settled the lawsuit, it denies that it did anything wrong.

Florida sandwich company files Chapter 11 bankruptcy

When a Florida company's business declines, it could quickly encounter financial difficulties. If the situation becomes dire, filing for Chapter 11 bankruptcy could give a business the time it needs to reorganize, which could allow the company to remain viable. Owners of a Spanish mini-sandwich company called 100 Montaditos filed Chapter 11 on March 4 and may be hoping to regroup.

Four related companies, including 100 M Holdings, which is the parent company of 100 Montaditos in the United States, filed individual petitions in federal Bankruptcy Court here in Florida. The other three companies are 100 M Lincoln, 100 M Franchise and 100 M Operator. Nine separate restaurants, eight of which are located in south Florida, also filed.

An alternative to bankruptcy liquidation

Many Florida companies encounter financial problems. Sometimes, the circumstances are such that filing for bankruptcy appears to be the best option available. However, there may be another option that could provide a better resolution to a company's difficulties.

An Assignment for the Benefit of Creditors (ABC) may generate more revenue to repay creditors than a bankruptcy liquidation. In an ABC, the assets of the company are assigned to an independent third party. The assignee, as the third party is called, becomes responsible for the sale of the assets. The proceeds are then distributed to your creditors.

Campbell Soup discussses corporate restructuring in Florida

In order for a business to thrive, it must be willing to change in order to adapt to an ever-changing market. Even large corporations like Campbell Soup need to make adjustments to remain competitive. In Feb. 2015, the company provided details of its plan for corporate restructuring, which was announced at the end of January at a conference in Florida.

At the core of the company's plan are cost reduction initiatives that are aimed at reducing costs over the next three years by approximately $200 million. The savings could then be applied to those portions of the company in which significant growth is anticipated. However, cost savings are not enough.

Sales of businesses do not always proceed as planned

A Florida developer made a $95.4 million deal to purchase a struggling casino in the gambling capital of the northeast. However, the Revel Casino Hotel is asking its bankruptcy judge to cancel the sale. If the developer is not allowed to go through with the purchase, this will make two failed sales of the casino.

The casino says that it wants to cancel the sale because, for the second time, a dispute has cropped up over the casino's power plant. In addition to the power plant, the nightclubs and restaurants associated with the casino are also disputing the sale for fear of losing their leases. At this point, it is unclear whether those properties were included in the sale to the Florida developer.

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