Article

Practical Law | Successor Liability in Distressed Transactions

September 2025 – Practical Law The Journal

Current market conditions present unique opportunities for distressed investing. Although the acquisition of distressed assets may be profitable, it is not without risk, including potential exposure to successor liability.

While successor liability risks are often present in transactions, they increase when a buyer acquires distressed assets because the seller may not have the financial resources to fully satisfy its creditors. Buyers must consider potential successor liability claims when acquiring distressed debt or investing in distressed assets and adopt strategies to mitigate and, if judicially approved, potentially eliminate these risks from the transaction. 

Click here to read the full article written by Louis DeLucia, Alyson Fiedler, and Michael Ott published in Practical Law's The Journal. Login may be required.

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