Long Point Capital is pleased to announce the dismissal, with prejudice and without any out-of-pocket payment by Long Point, of all litigation relating to Long Point’s investment in architecture and engineering firm EYP, and EYP’s conversion into an Employee Stock Ownership Plan (“ESOP”)-owned entity.
In August 2020, a small handful of EYP’s 100-plus noteholders filed suit in federal court in New York, alleging that Long Point committed fraud and other wrongdoing in connection with the EYP investment and ESOP conversion. On March 31, 2022, the court dismissed plaintiffs’ complaint, finding that it did not “bring to bear any . . . facts to support a finding of fraud.” Long Point then sought sanctions against plaintiffs and their counsel for filing a frivolous lawsuit.
On November 15, 2022, pursuant to the terms of a settlement approved by federal bankruptcy court, EYP and its noteholders released Long Point from all claims relating to the EYP investment and ESOP conversion. Long Point Capital, in turn, withdrew its request for sanctions. No out-of-pocket payments were made by Long Point Capital, its funds, or its principals to resolve the litigation.
“We are pleased to put this EYP-related litigation behind us,” said Long Point Capital founding partner Ira Starr. “Long Point did not engage in any wrongdoing with respect to the 2016 EYP transactions, and we believe that the federal court’s March 2022 decision and the settlement terms confirm that fact.”
About Long Point Capital
Long Point Capital, with offices in New York and Michigan, seeks to partner with and invest in leading founder, family, and management-owned businesses operating in defensible niches with stable demand, highly capable management teams and strong growth prospects. Long Point focuses on companies in the professional services sector, typically with $5 million to $30 million in EBITDA. For more information, please visit our website at www.longpointcapital.com.