In March 2013, the Seventh Circuit Court of Appeals, in an opinion written by Judge Richard A. Posner, decided the case of
Acquiring More Than Just Assets
The implications of the ruling are clear: Where one company seeks to acquire the assets of another, a simple disclaimer of liability will not be sufficient. Due diligence requires that the successor company closely examine any pending employment-related litigation of the seller and determine how a particular sale implicates the successor liability test under the federal common law.
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