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DLA Piper

Delaware Bankruptcy Court Clarifies Broad Scope of Fraudulent Transfer Claims

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The US Bankruptcy Court for the District of Delaware recently reaffirmed but limited the holding of In re DSI Renal Holdings, LLC, which held that under Third Circuit law, neither debtors nor trustees could bring fraudulent...more

Morris James LLP

Chancery Removes an Assignee for Cause in an Assignment for the Benefit of Creditors Proceeding

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In re: Wack Jills, Inc., C.A. No. 2019-0650-PAF (Del. Ch. Aug. 29, 2024) - In this proceeding for the assignment for the benefit of creditors (“ABC proceeding”), the company assigned all of its property and assets to...more

Morris James LLP

Delaware LLCs, Independent Managers, and Bankruptcy Remote Structures: Lessons from 301 W North Avenue

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Overview Limited liability companies (LLCs)—curious creatures of state law—often file bankruptcy. Bankruptcy courts have, therefore, developed a dynamic body of law to evaluate the “bankruptcy remoteness” of LLCs, assessing...more

Mintz - Bankruptcy & Restructuring Viewpoints

Delaware Bankruptcy Court Grants Derivative Standing to Creditors’ Committee to Sue Members and Officers of Delaware LLC

In early February, a Delaware bankruptcy judge set new precedent by granting a creditors’ committee derivative standing to pursue breach of fiduciary duty claims against a Delaware LLC’s members and officers. At least three...more

Jones Day

Delaware Bankruptcy Court Imputes Officer's Fraudulent Intent to Corporation in Avoidance Litigation

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A powerful tool afforded to a bankruptcy trustee or a chapter 11 debtor-in-possession ("DIP") is the power to recover pre-bankruptcy transfers that are avoidable under federal bankruptcy law (or sometimes state law) because...more

Ballard Spahr LLP

DE Supreme Court: Creditors’ Fraudulent Transfer Claims Are Direct, Not Derivative

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Delaware’s Supreme Court recently clarified the difference between derivative and direct claims in the context of a dispute over whether creditors’ fraudulent transfer claims were covered by insurance policies applicable to...more

Proskauer Rose LLP

“Free and Clear” Collides with “Perfectly Clear”: Delaware District Court Imposes Successor Liability on Buyer in 363 Sale

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Navigating the Bankruptcy Code can present many traps for unsuspecting debtors, creditors, or asset buyers. The Delaware District Court recently reminded bankruptcy participants of an often overlooked pitfall involving the...more

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