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Delaware Supreme Court holds creditors of insolvent LLCs do not have derivative standing

CML V, LLC v. Bax, et al., 2011 Del. LEXIS 480 (Del. Sept. 2, 2011)

CASE SNAPSHOT

Affirming the decision of the Court of Chancery for the State of Delaware, the Delaware Supreme Court held that, unlike corporate creditors, creditors of a Delaware Limited Liability Company do not have standing to sue the LLC’s officers derivatively on behalf of an insolvent LLC.  

FACTUAL BACKGROUND

USA, Delaware, Insolvency & Restructuring, Litigation, Reed Smith LLP, Limited liability company, Standing (law), Balance sheet, Internal control, Derivative suit, Court of Chancery, Delaware Supreme Court, Court of equity
Court finds defendants knowingly waived right to jury trial, affirms such waivers must be clear

Lehman Brothers Holdings, Inc. v. Bethany Holdings Group, LLC, et al., 2011 WL 3427013, (S.D.N.Y. Aug. 5, 2011)

CASE SNAPSHOT

USA, Banking, Insolvency & Restructuring, Litigation, Real Estate, Reed Smith LLP, Surety, Waiver, Jury trial, Default (finance), Lehman Brothers
In a case of first impression, court grants administrative priority status to post-petition withdrawal liability

In re Marcal Paper Mills, Inc., No. 09-4574, 650 F.3d 311 (3d Cir., 2011)

CASE SNAPSHOT

USA, Employee Benefits & Pensions, Insolvency & Restructuring, Litigation, Reed Smith LLP, Employee Retirement Income Security Act 1974 (USA), Defined benefit pension plan, Third Circuit
Director’s motion to dismiss breach of duty of good faith claim denied

NHB Assignments, LLC v. General Atlantic, LLC and Braden Kelly (In re PMTS Liquidating Corp., et al.) Case No. 08-11551 (BLS) (Bankr. D. Del. July 1, 2011)  

CASE SNAPSHOT

USA, Delaware, Insolvency & Restructuring, Litigation, Reed Smith LLP, Debtor, Breach of contract, Fraud, Fiduciary, Board of directors, Interest, Limited liability company, Liquidation, Good faith, Due diligence, Title 11 of the US Code, Chief executive officer, Trustee
Credit swap agreement ipso facto clause struck

Lehman Brothers Special Financing, Inc. v. Ballyrock ABS-CDO 2007-1 Limited (In re Lehman Brothers Holdings, Inc.) No. 09-01032 (JMP) (Bankr. S.D.N.Y. May 12, 2011)  

CASE SNAPSHOT

USA, New York, Derivatives, Insolvency & Restructuring, Litigation, Reed Smith LLP, Bankruptcy, Surety, Debtor, Injunction, Swap (finance), Liquidation, Asset forfeiture, Default (finance), Collateralized debt obligation, Mortgage-backed security, Right to property, Lehman Brothers, US District Court for the Southern District of New York
FAA registration law does not preempt state UCC where partially completed airplanes fail to satisfy FAA definition of “aircraft”

Mata, et al., v. Eclipse Aerospace, Inc. (In re AE Liquidation, Inc., et al.) Case No. 08-51891, 2011 BL 51047 (Bankr. D. Del. Feb. 28, 2011)

CASE SNAPSHOT

USA, Delaware, Aviation, Insolvency & Restructuring, Litigation, Reed Smith LLP, Federal preemption, Debtor, Breach of contract, Fraud, Liquidation, Aircraft registration, Constructive trust, Federal Aviation Administration, Uniform Commercial Code (USA), Trustee, United States bankruptcy court