By Posted in Corporate & Fiduciary LitigationI have written about the waning popularity of deepening insolvency (and here) as a cause of action. Bob Eisenbach refers to a new article by his colleagues in the Bankruptcy & Restructuring group at Cooley Godward Kronish LLP, Michael Klein and Ronald Sussman. The article is entitled "Tide Has Turned On Deepening Insolvency – Courts Now Rejecting… Continue Reading
By Posted in Miscellaneous CasesThe theory of deepening insolvency as a separate tort has had mixed results. It has never been truly recognized in Georgia, as noted by a Texas court. Other courts have held that it is a theory of damages rather than a cause of action. In a big strike against its viability, the Delaware Chancery Court said… Continue Reading
By Posted in Corporate & Fiduciary Litigation,Miscellaneous CasesPosted By: Scott B. Riddle, Esq. In Kaye v. Dupree, et al. (In re Avado Brands, Inc.), Adv. No. 05-3823, 2006 Bankr. LEXIS 3631 (Bankr. N.D. Tex. December 28, 2006), the Trustee of the Debtor’s Litigation Trust filed a post-confirmation suit against the Debtor’s former officers and directors. The causes of action included preferential transfers,… Continue Reading
By Posted in Miscellaneous CasesIn Trenwick America Litigation Trust v. Ernst & Young, LLP, et al, 906 A.2d 168, 2006 Del Ch. LEXIS 139 (Del. Ch. August 10, 2006), the Chancery Court firmly held that deepening insolvency is not a valid cause of action under Delaware law. It will be interesting to see how the Delaware Supreme Court rules… Continue Reading
