Did the Delaware Supreme Court Break the 'Directors' Shield'?
July 30, 2007
<i>Credit Lyonnais Bank Nederland, N.V. v. Pathe Communications Corp.</i> stands for the proposition that directors and officers of a Delaware corporation that is either insolvent or in the 'zone' of insolvency owe fiduciary duties to creditors as well as stockholders. In essence, it provided a 'shield' to directors against shareholder suits alleging that directors breached their duties to shareholders by acting to protect creditors. Now, the Delaware Supreme Court may have "broken the shield."
A Spouse's Bankruptcy Trumps Divorce
June 28, 2007
An ex-wife who was awarded all of the martial assets in a bitter divorce was nevertheless unable to take possession of those assets because they were part of the ex-husband's bankruptcy estate. A federal appeals panel so held, reasoning that because the matrimonial judgment was docketed after the filing of the Chapter 7 petition, the marital assets remained part of the bankruptcy estate subject to distribution by the bankruptcy court.
Redemption Payments Salvaged Prior to the Collapse of Ponzi Schemes
June 27, 2007
What can be worse than crushed expectations? Consider the following: An investor's money was invested with a hedge fund that turned out to be a Ponzi scheme. In a stroke of luck, the investor avoided a huge loss by redeeming his investment and gains prior to the collapse of the crooked company. Now, the trustee of the bankrupt hedge fund wants the money back, claiming that the transfer was fraudulent under ' 548 of the Bankruptcy Code and the N.Y. Fraudulent Conveyance law (New York Debtor & Creditor Law '' 271-276). Is there a quick way out of this nightmarish scenario? No, according to <i>Bayou Superfund LLC v. WAM Long/Short Fund II. L.P. et al. (In re Bayou Group, LLC)</i>, 2007 WL 582530 (Bankr.S.D.N.Y.)
Attorneys' Fees Preserved In Bankruptcy Cases
June 27, 2007
This article discusses the development of the <i>Fobian</i> rule and other courts' treatment of it. The article also summarizes the Supreme Court's reasoning in abrogating the rule in <i>Travelers Casualty & Surety Co. v. Pacific Gas & Electric Co. (In re Pacific Gas & Electric Co.)</i>, 549 U.S. ____, 127 S. Ct. 1199 (2007).
Prime Brokers, Take Note
June 27, 2007
A recent decision issued by the Bankruptcy Court for the Southern District of New York (the 'Bankruptcy Court') in <i>Gredd v. Bear, Stearns Securities Corp. (In re Manhattan Inv. Fund Ltd.)</i>, 2007 WL 60843 (Bankr. S.D.N.Y. Jan. 9, 2007) represents a significant event for securities firms, with potentially far-reaching implications for prime brokers.
On the Move
June 27, 2007
Who's doing what; who's going where.
On the Move
May 29, 2007
Who's moving where; who's doing what.
