As you know from our prior alerts, creditors of borrowers formed as Delaware LLCs (as opposed to corporations) lack standing under Delaware law to sue directors for breaching fiduciary.
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.
In an opinion on January 22nd, the Fifth Circuit Court of Appeals, in Matter of S. Coast Supply Co., 91 F.4th 376 (5th Cir. 2024), held that preference claims arising under 11 U.S.C. §.
On Monday, January 22, 2024, the United States Court of Appeals for the Fifth Circuit entered a ruling in the South Coast Supply Company case allowing a bankrupt debtor to sell preference.
On Monday, January 22, 2024, the United States Court of Appeals for the Fifth Circuit entered a ruling in the South Coast Supply Company case1 allowing a bankrupt debtor to sell preference claims.