Schulte Roth & Zabel LLP

On Dec. 31, 2024, the US Court of Appeals for the Fifth Circuit issued a long-awaited decision reversing the ruling of former Judge David Jones of the Bankruptcy Court for the Southern District of Texas, blessing the Serta Simmons Bedding 2020 uptier transaction. The ruling deemed the uptier transaction impermissible and potentially puts pressure on other uptiering transactions.  More specifically, the Court held that Serta’s exchange of the Prevailing Lenders existing debt for new super-priority debt — to the detriment of Excluded and LCM Lenders (i.e., non-participating lenders who objected to the transaction) — did not qualify as a permissible open market purchase under the governing loan agreement and violated the agreement’s pro rata sharing provision.    Read the full Alert at the link in the comments section. Authors: Douglas Mintz | David Arnstein | Bill Gussman | Douglas Koff | Reuben Dizengoff | Lindsey Neuberger #SchulteLaw 

Schulte is proud to announce its largest partner class in firm history, marking a significant milestone in the firm’s growth and expansion. Effective January 1, 2025, 12 exceptional lawyers — Ari Aranda, Max Garfield, Brandon Gold, David Lifshitz, Sean Locklear, Amy MacDonagh, Andrew Mazzarella, Frank Olander, Minji Reem, Lauren Troeller, Hannah Wells and Saarah Woodby — joined the firm’s partnership, representing a diverse array of talent across Schulte’s New York and London offices.     "The firm achieved exceptional growth this year, fueled by a high level of business activity and new market opportunities that bolstered our presence and reaffirmed our position in the financial sector," said Marc Elovitz, co-managing partner. "We carry this momentum into 2025, marked by promotions that underscore the depth and breadth of our talent and showcases the unique and focused synergy across Schulte’s practice groups.”    David Efron, co-managing partner, added, “At Schulte, collaboration is the cornerstone of our success. This culture not only drives exceptional outcomes for our clients, but also fosters an environment where our lawyers can thrive. These promotions are a testament to that ethos and our ability to anticipate and adapt to the changing needs of our clients.” In addition, Schulte has promoted five accomplished lawyers to special counsel: Chris Hamilton, Daniel R. Neer, Sasha O'Leary, George Rowe and Abraham Schwartz.     Read more at the link in the comment section.    #SchulteLaw #NewPartners #NewSpecialCounsel

Schulte represented AS Birch Grove LP (“Birch Grove”), a diversified alternative credit fund manager, in a definitive agreement to be acquired by Third Point LLC (“Third Point”), an alternative investment manager with $12 billion in assets under management. Following the completion of the transaction, expected in Q1 2025, Birch Grove will become a subsidiary of Third Point, and American Securities will no longer hold an ownership interest in the firm.   Birch Grove has approximately $8 billion of assets under management in strategies including collateralized loan obligations (CLOs), opportunistic private credit solutions, multi-strategy credit, senior loans and high-yield bonds. The move to join the Third Point platform will enable Birch Grove to leverage the firm’s success in credit market investments and its team of experienced investment professionals to drive the growth of Birch Grove's funds.   Schulte’s M&A team was led by Benjamin Kozinn, co-chair of the M&A Group, with special counsel Ross Karlik and associates Crystal Henwood, Sam Weiss and Conrad Z. Zhong. Partners Philippe Benedict (Tax), Michael Didiuk (IM), Alexander Kim (IP), Ian L. Levin (Employment), David Nissenbaum (IM) and Craig Stein (Finance), along with special counsel Adam Gartner (Employment) and Scott M. Kareff (IP), associates Jacob Gach (Tax) and Rachel Siegel (IM), and law clerk Julianna Dietz (IM) assisted in the deal. #SchulteLaw

On Dec. 26, 2024, the US Court of Appeals for the Fifth Circuit reinstated the nationwide preliminary injunction that enjoins enforcement of the Corporate Transparency Act and its implementing regulation (31 C.F.R. §1010.380), including the filing deadlines thereunder. The Fifth Circuit’s Dec. 26 order by the panel which will hear the pending appeal vacates an earlier order of a motion’s panel of the Fifth Circuit that had stayed the nationwide preliminary injunction pending the government’s appeal on the merits. The panel left in place an order expediting the appeal; oral argument on the merits of the government’s appeal is scheduled for March 25, 2025. Learn more in this Alert: https://bit.ly/4jcO8HZ Authors: Melissa Goldstein | Betty Santangelo | Michael Didiuk | Jessica Romano | Kyle Hendrix | Bryson Kern #SchulteLaw

The IRS has posted a notice that their online service to apply for EINs will be unavailable from about 3pm EST Dec. 27, 2024, to 7am EST Jan. 2, 2025. During that time, we will not be able to apply for EINs for domestic or foreign entities. Accordingly, any entity that needs an EIN before year end should apply within the next three days, as we cannot predict the availability of IRS officials to issue EINs by other means. As a reminder, only one EIN can be issued per day in respect of a responsible party (typically, an individual who is the general partner, managing member or principal officer of the electing entity). Read the IRS service outage announcement: https://bit.ly/3ZQsbFE

On Dec. 23, 2024, the US Court of Appeals for the Fifth Circuit stayed the nationwide preliminary injunction that enjoined enforcement of the Corporate Transparency Act and its implementing regulation (31 C.F.R. §1010.380). Reporting companies are now required to file beneficial ownership information reports with the US Department of the Treasury’s Financial Crimes Enforcement Network while the outcome of the government’s ongoing appeal of the District Court’s order is pending.  Learn more in this Alert: https://bit.ly/3VRn6vm Authors: Melissa Goldstein | Betty Santangelo | Michael Didiuk | Jessica Romano | Kyle Hendrix | Bryson Kern #SchulteLaw

As the year comes to an end, we celebrated many of our pro bono clients at their annual galas. A particular highlight was when Schulte partner and co-chair of the Litigation Group Michael E. Swartz was a featured speaker at this year’s Higginbotham Leadership Awards. The event was hosted by the Lawyers' Committee for Civil Rights Under Law, where Michael serves as co-chair of the board. The Lawyers’ Committee hosts the Higginbotham Awards gala annually to highlight the exemplary contributions of corporate executives, policy makers, professional athletes, authors, artists and other individuals who champion the cause of justice and equality for all. The gala is one of the largest events in the civil rights community. Among the country’s foremost civil rights organizations, the Lawyers’ Committee was formed after President John F. Kennedy convened more than 200 lawyers from across America to “mobilize the nation’s leading lawyers as agents of change in the Civil Rights Movement.” Read more about the event: https://bit.ly/3Yn12cy #SchulteLaw #HigginbothamAwards #JusticeForAll

We asked this year's #FallAssociates to share their thoughts on their first month at Schulte. John Tuley #SchulteLaw

This Alert serves to update clients on the recent legal developments related to the Corporate Transparency Act (“CTA”) and its implementing regulation (31 C.F.R. §1010.380 (“Reporting Rule”)) since our prior Alert on Dec. 4, 2024. At this time, none of the recent developments relating to the nationwide preliminary injunction concerning the CTA and the Reporting Rule change our view that filing of beneficial ownership information reports (“BOI Reports”) is voluntary while the nationwide preliminary injunction remains in place.  In other words, there is no requirement to submit or update BOI Reports while the nationwide preliminary injunction is in effect. Given the future uncertainty however, we recommend that clients continue to prepare for anticipated BOI Report filings in the event the nationwide preliminary injunction is lifted, stayed or altered. Learn more in this Alert: https://bit.ly/41HLRhs     Authors: Melissa Goldstein | Betty Santangelo | Michael Didiuk | Jessica Romano | Kyle Hendrix    #SchulteLaw 

Schulte represented Soros Fund Management in a consortium’s $82.5 million acquisition of BuzzFeed’s First We Feast, the production company behind the popular interview show “Hot Ones”. This transaction will allow First We Feast to become an independent multi-platform media company. First We Feast will continue to produce “Hot Ones” episodes without major changes, using the investment from the sale to develop new content franchises and explore future collaborations with other creators. The Schulte team was led by the M&A and Securities Group headed by partner Mike Flynn, special counsel Lauren Troeller and associate Mitchell DaSilva. They were assisted by partners Ted Keyes (Environmental; Insurance), Alexander Kim (Intellectual Property), Ian L. Levin (Employment and Employee Benefits), Joseph Reich (Tax), Greg Ruback (Finance) and Julian Wise (Real Estate), along with special counsel Adam Gartner (Employment and Employee Benefits) and John Doherty (M&A) and associates Steven M. Appel (Intellectual Property), Julia Cummings (M&A), Joseph D'Arco (M&A), Lance Kodish (Real Estate), Sarah Reichek (M&A)  and Hannah Hollingsworth (Tax). #SchulteLaw