ACIC Private Notes - September 2018

Welcome to the September 2018 edition of the ACIC Private Notes! In this month's newsletter, you will find recent case law updates from the Southern region (courtesy of Jeff Dutson of King & Spalding LLP) and the New England region (provided by Kevin Braun of Morgan, Lewis & Bockius LLP).

In addition, the newsletter contains a summary of recent FERC changes to PJM Interconnection, LLC's capacity market structure (courtesy of Michael Robson of Greenberg Traurig).

Finally, this edition contains a request from The Private Placement Investors Association (PPIA) to add a new step into your closing checklist procedures for private placement securities involving a private letter rating.

2018 Annual Meeting and Education Conference

The 2018 Annual Meeting and Education Conference takes place at the Grand Hyatt in New York on October 18 and 19. Click here to learn more about the event from this year's co-chairs, and be sure to click here to register and keep track of program updates. We look forward to seeing you there!

Legal Developments

Southern Region

In Bennett v. Jefferson County, Alabama, the Eleventh Circuit recently extended the "equitable mootness" doctrine and dismissed an appeal of the confirmation of a plan of reorganization. Click here to read the background of the case, a summary of the decision and the key takeaway of obtaining a stay of bankruptcy confirmation order and expedited appeal before the plan is consummated.

The Georgia Court of Appeals recently considered a case involving the propriety of paying expenses in accordance with participation agreements prior to distributing sales proceeds from secured property. Click here to read a background of the trial court decision and the upper court's ruling.

In Tri-State Petroleum Corp. v. Coyne, the Circuit Court of Ohio County held that a minority shareholder may have a direct cause of action for breach of a fiduciary duty against a majority shareholder in a close corporation. Click here

to learn more.

The Supreme Court of South Carolina recently recognized single business enterprise theory and clarified the criteria in Pertius v. Front Roe Restaurants, Inc. Click here for a discussion of the case and the criteria.

New England

The District Court of Massachusetts, in Gelfgatt v. U.S. Bank National Association,recently held that the acceleration of the maturity date of a promissory note secured by a mortgage does not affect the maturity date of the mortgage under the Massachusetts Obsolete Mortgage Statute. Click here for a summary of the decision.

In Jenzack Partners LLC v. Stonebridge Associates, LLC, et. al., the Connecticut Appeals Court held that an assignment of a promissory note carried with it an assignment of the underlying guarantee even where no assignment of the guarantee was specified in the allonge. Click here for a background on the case and decision.

The Vermont Supreme Court held that there was a six-year statute of limitations under the Vermont UCC rather than a fourteen-year statute of limitations under Vermont Statutes for a witnessed promissory note. Click here

to read more.

FERC Changes to PJM Capacity Market

FERC recently issued an order rejecting market revisions proposed by PJM Interconnection, LLC to its capacity market structure to accommodate State public policy initiatives in wholesale competitive markets. Click here to learn more about the order and the potential impacts on wholesale capacity markets.

New Closing Checklist Item for PP Securities with Private Ratings Letters

The Private Placement Investors Association (PPIA) asks that you add a new step into your closing checklist procedures for private placement securities. If a transaction has a private letter rating issued by a rating agency, then we ask that you notify that rating agency of the private placement numbers (PPNs) as soon as you receive said numbers from CUSIP. The rating agency can then include PPNs on the final copy of its private ratings letter to be delivered at transaction close, and it can populate these numbers into its data warehouse, to facilitate electronic delivery of private ratings to the SVO (a suboffice of the NAIC). Click here to continue reading.

American College of Investment Counsel

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