Sell-Side Directors May Be Liable for Breach of Fiduciary Duty Claims for Failing to Investigate Company's Post-Closing Solvency

In In re Nine West LBO Securities Litigation (Case No. 20-2941) (S.D.N.Y. Dec. 4, 2020), a federal district court denied in part a motion to dismiss claims brought by the Nine West liquidating trustee against former directors (the "Defendants") of The Jones Group, Inc. (the "Company"), Nine West's predecessor, for, among other things, (i) breaches of their fiduciary duties of care and loyalty, and (ii) aiding and abetting breaches of fiduciary duties. The litigation arises from the 2014 LBO of the Company by a private equity sponsor ("Buyer").

Filed under:
USA, Company & Commercial, Insolvency & Restructuring, Litigation, Winston & Strawn LLP, Private equity, Due diligence
Authors:
Dominick DeChiara , Bryan C. Goldstein , Carey D. Schreiber , Bradley C. Vaiana
Location:
USA
Firm:
Winston & Strawn LLP
Supreme Court Provides Guidance on the Use of Structured Dismissals in Bankruptcy

The United States Supreme Court (the “Court”) recently issued a long-awaited decision in Czyzewski v. Jevic Holding Corp. (“Jevic”), which limits the use of “structured dismissals” in Chapter 11 bankruptcy cases, requiring structured dismissals pursuant to which final distributions are made to comply with the Bankruptcy Code’s priority scheme, or the consent of all affected parties to be obtained.1

What is a Structured Dismissal?

Filed under:
USA, Insolvency & Restructuring, Litigation, Winston & Strawn LLP, SCOTUS, United States bankruptcy court
Authors:
Linda T. Coberly , Gregory M. Gartland , Steffen N. Johnson , Justin E. Rawlins , Carey D. Schreiber
Location:
USA
Firm:
Winston & Strawn LLP