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The complaint then alleges material misstatements of fact that were made in

August 2000 by the Trenwick directors in the LaSalle merger proxy:

A supposed statement that the Chartwell merger had been “beneficial and was expected to result in cost savings;”

48

An overstatement of the “amount of intercompany loans given by” Trenwick;

49

A claim that the “LaSalle acquisition would make Trenwick more competitive in all of its major markets;”

50

Allegedly, the Trenwick directors knew “these statements were false when made.”

Again, “Plaintiff” — i.e., Trenwick America — supposedly relied detrimentally on the

statement.51

F. The Causes Of Action In The Complaint

The complaint sets forth eight counts. All center on one idea: Trenwick’s strategy

of growing by acquiring Chartwell and LaSalle was “irrational” and resulted from “gross

negligence.”52 As a result of stupidity, the Trenwick directors, whose bidding was

followed by the Trenwick America directors, put together a large insurance holding

company with inadequate reserves and assets to cover the claims that were ultimately

made against it. By pledging the assets of Trenwick America to cover the debt resulting

from this expansion strategy, the Trenwick and Trenwick America directors injured

Trenwick America by rendering it insolvent and leaving it with too few assets to satisfy

48 49 50 51 52

.

¶ 100.

31

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