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James Brown Bonds?
Highest Court New York Supreme Court, Appellate Division
Year Ended 2009
Plaintiffs Brown, James
Business Entity of Artist(s)
Defendants Financial Institution(s)
Pullman, David
Other No Other parties on file
Short Description This lawsuit involves an obscure little investment vehicle known as a "Pullman Bond," though it is probably better known as a "Bowie Bond," named after David Bowie, the pop star that first utilized it. In the late 1990s, Bowie issued asset-backed securities of revenues generated by his pre-1990 albums, offering an interest rate of 7.9%, to be paid out of royalties from those albums. Bowie cashed in $55 million from the deal, though he forfeited 10 years worth of royalties (the life of the bonds). This lawsuit does not involve Bowie, but James Brown, who used a similar process in securing a $26 million loan from Defendant, the Pullman Group for which the Pullman Bond is known, shortly after Bowie's deal was finished. Brown pledged future revenue in exchange for the $26 million loan, but also promised Pullman, in writing, that he would refinance the assets "upon future recoupment of the securities" with Pullman alone. When Brown tried refinancing through a third party, Pullman sent a notice to that company, as well as Brown and his entities. The refinancing transaction broke down, and Brown sued for declaratory judgment of non-breach and for interference with business relationships. Pullman counterclaimed for declaratory judgment and breach of contract. The definition of "recoupment," as intended by the parties, determined whether there was a breach. Brown's claims for interference with business were dismissed, since Pullman's letter was only intended to explain its financial interest. So was Pullman's action for breach, since the refinancing, if it were a breach, was never consummated. Furthermore, a declaration of breach or non-breach is pointless, because the refinancing was abandoned. - LSW

Legal Issues
Contracts Breach Payment & Performance
  Terms Declaratory Judgment
Torts Economic Torts Fraud, Misrepresentation & Inducement
    Interference with Contract, Business, Interests & Expectancy


Opinions Estate of Brown v. Pullman Group
875 N.Y.S.2d 460
New York Supreme Court, Appellate Division , March 12, 2009 ( _ )


Brown v. The Pullman Group, LLC
2008 WL 1773932
New York Supreme Court , April 08, 2008 ( No. 0602593/2006 )


Brown v. The Pullman Group
2007 WL 2815471
New York Supreme Court , August 20, 2007 ( No. 0602593/2006 )


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Related Searches Parties
Brown, James ( Plaintiff )
Business Entity of Artist(s) ( Plaintiff )
Financial Institution(s) ( Defendant )
Pullman, David ( Defendant )

Legal Issues
Contracts / Breach / Payment & Performance
Contracts / Terms / Declaratory Judgment
Torts / Economic Torts / Fraud, Misrepresentation & Inducement
Torts / Economic Torts / Interference with Contract, Business, Interests & Expectancy

Courts
New York Supreme Court, Appellate Division (highest court)
New York Supreme Court


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