Adam Wolk, left, and Barbara Goodstein, right, of Mayer Brown. Courtesy photos Introduction
Last June this column discussed two federal court cases showing the challenges faced by lawyers in structuring bank deposit arrangements, such as trusts and escrows, free of bankruptcy risk of the depositor. ("Trusts, Escrows and Property of the Estate (or Not)," 269 N.Y.L.J. 109 (June 8, 2023)). These two decisions, one by a bankruptcy court in the Southern District of New York involving an attorney escrow account, and the other by a federal district court in the Northern District of Texas involving a trust arrangement, reached the same conclusion—namely that the cash at issue was subject to claims of the depositor's creditors. These cases emphasize the continuing uncertainty across states of treatment of different structures intended to insulate cash from the risk of bankruptcy of its depositor. Fortunately, this uncertainty may soon be resolved by a uniform state statute proposed by the Uniform Law Commission.What's Special About Special Deposits? The New Uniform Special Deposits Act
In their Secured Transactions column, Barbara M. Goodstein and Adam C. Wolk, discuss the Uniform Special Deposits Act. The act aims to create a set of "clear and executable" rules to govern bank deposits that involve at least two beneficiaries (one of whom may be the depositor) where "the identity of the person entitled to payment is not determined until the occurrence of a contingency identified at the time the deposit is created."
January 31, 2024 at 01:12 PM
11 minute read
Banking and Finance Laws
Adam Wolk, left, and Barbara Goodstein, right, of Mayer Brown. Courtesy photos
Introduction
Last June this column discussed two federal court cases showing the challenges faced by lawyers in structuring bank deposit arrangements, such as trusts and escrows, free of bankruptcy risk of the depositor. ("Trusts, Escrows and Property of the Estate (or Not)," 269 N.Y.L.J. 109 (June 8, 2023)). These two decisions, one by a bankruptcy court in the Southern District of New York involving an attorney escrow account, and the other by a federal district court in the Northern District of Texas involving a trust arrangement, reached the same conclusion—namely that the cash at issue was subject to claims of the depositor's creditors. These cases emphasize the continuing uncertainty across states of treatment of different structures intended to insulate cash from the risk of bankruptcy of its depositor. Fortunately, this uncertainty may soon be resolved by a uniform state statute proposed by the Uniform Law Commission.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View All
Bank of America's Cash Sweep Program Attracts New Legal Fire in Class Action
3 minute read
DOJ: TD Bank Agrees to Pay $3B Over Anti-Money Laundering Program Violations
2 minute read
A Review of Fordham's Annual Conference on International Antitrust Law & Policy, and Antitrust Economics Workshop
13 minute readLaw Firms Mentioned
Trending Stories
- 1UN Treaty Enacting Cybercrime Standards Likely to Face Headwinds in US, Other Countries
- 2Clark Hill Acquires L&E Boutique in Mexico City, Adding 5 Lawyers
- 36th Circuit Judges Spar Over Constitutionality of Ohio’s Ballot Initiative Procedures
- 4On The Move: Polsinelli Adds Health Care Litigator in Nashville, Ex-SEC Enforcer Joins BCLP in Atlanta
- 5After Mysterious Parting With Last GC, Photronics Fills Vacancy
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250
