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Initially, I will consider exactly whose claims the Litigation Trust may press in

this litigation. Once I do that, I will consider whether the Litigation Trust has stated a

claim for breach of fiduciary duty against the Trenwick and Trenwick America directors.

Then, I will determine whether Delaware law recognizes as an independent cause of

action an assertion that fiduciaries “deepened” the insolvency of an entity. After that, I

will address the viability of the fraud claims brought against the Trenwick and Trenwick

America directors. Finally, I will address the claims brought against the defendants who

were Trenwick advisors.

A. The Litigation Trust Lacks Standing To Pursue Claims On Behalf Of Trenwick America’s Creditors

As a creature of statute and Trenwick America’s chapter 11 plan of reorganization,

the Litigation Trust is entrusted with standing to pursue only certain defined “Causes of

Action.”59 But the Litigation Trust conceives its standing to be more expansive than the

defendants interpret it to be under federal bankruptcy law and Trenwick America’s

governing reorganization plan. The Litigation Trust contends that, under the terms of

Trenwick America’s plan of reorganization, the Trust has standing to pursue claims on

behalf of Trenwick America’s creditors in addition to any claims Trenwick America had

before the filing of its bankruptcy petition. The defendants agree that the Trust has

standing to bring any claims Trenwick America holds, but the defendants disagree that

the Trust has standing to pursue claims on behalf of Trenwick America’s creditors. I find

that the defendants are correct that the Litigation Trust does not have standing to pursue

59

TAC Second Amended Plan of Reorganization § 6.03; Litigation Trust Agreement § 1.1.

35

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