Insolvency-Related Litigation

Both the FRI Department and the Litigation Department represent clients in adversary proceedings and litigation claims relating to fraudulent conveyances and preferences. Our lawyers also have served as special counsel for debtors, litigation trusts, and trustees in litigation against third parties and investigations relating to dischargeability and location of assets. Our lawyers have represented:

• Bank of New York Mellon (as indenture trustee for certain noteholders) in In re Lyondell Chemical Company as plaintiff and intervenor in $22 billion fraudulent transfer action arising out of a leveraged buyout.
  
  
• Multiple parties in connection with hundreds of millions of dollars of potential clawback claims stemming from the SIPA liquidation of Bernard L. Madoff Investment Securities LLC.
  
  
• Delphi Corporation as special litigation counsel in an adversary proceeding seeking specific performance and/or damages for breach of $2.55 billion investment agreement by chapter 11 plan investors.
  
  
• Mervyn's LLC in commencing a $1 billion fraudulent conveyance action arising out of leveraged buyout by private equity sponsors.
  
  
• Hedge fund clients in performing litigation analyses in Hexion Specialty Chemicals, Inc. v. Huntsman Corp. and UBS Securities, LLC & UBS Loan Finance, LLC v. The Finish Line, Inc. & Genesco, Inc.
  
  
• Lincoln General Insurance Company in litigation concerning the misappropriation of insurance premiums by third parties.
  
  
• The chapter 11 trustee in In re Kingston Square, a consolidated proceeding involving multiple properties, in which we litigated and settled a series of claims asserted by and against the debtors' estates.
  
  
• The former chairman of a now-bankrupt company that manufactured asbestos-containing products, in defending fraudulent conveyance and breach of fiduciary duty claims arising out of pre-bankruptcy asset sales and spinoffs.
  
  
• A major telecommunications company in defending fraudulent conveyance and preference claims arising out of an agreement with a now-bankrupt satellite company to terminate a stock purchase agreement.
  
  
• The creditors' committee in the chapter 11 case of IT Group, an environmental consulting and engineering company, in which we are prosecuting claims challenging the validity and extent of the liens asserted by pre-petition lenders and seeking to avoid certain transfers to such lenders.
  
  
• A financial institution as owner of a manufacturing facility in a leveraged lease transaction that is being challenged by the debtor as a disguised secured loan.
  
  
• The court-appointed liquidators of a Cayman Islands investment fund in the initiation of a proceeding in the United States ancillary to a foreign bankruptcy proceeding and the negotiation of a settlement entailing division of assets with affiliated U.S.-based funds.
  
  
• A U.K. hedge fund in U.S. bankruptcy court litigation in connection with its investment in debt issued by a foreign telecommunications operator.
  
  
• A major Northern California law firm as a defendant in a large, complex case involving a Ponzi scheme.
  
  
• The Litigation Advisory Board of the Granite Funds, for which we obtained $77 million in settlements from Bear Stearns, DLJ, and Merrill Lynch in a case arising out of the liquidation of complex derivative securities.
  
  
• The Liquidating Trustee of the SmarTalk Teleservices bankruptcy estate, in litigation alleging breach of fiduciary duty and fraud by SmarTalk's investment banker in connection with an acquisition, and fraud and aiding and abetting breach of fiduciary duty by other parties.
  
  
• The receiver of Philip Services Corp., a Canadian metals processing and environmental services company, as well as a syndicate of its lenders, in connection with claims in the hundreds of millions of dollars against Deloitte & Touche.