Mark E Felger

January 15, 2014 | Delaware Business Court Insider

When does the life of a Delaware corporation end? Not as long as there are third-party claimants with claims to assert and undistributed assets available to satisfy them. In Anderson v. Krafft-Murphy, No. 85, 2013 (Del. Nov. 26, 2013), asbestos tort claimants in lawsuits pending in other jurisdictions against Krafft-Murphy Co., a dissolved Delaware corporation, sought the appointment of a receiver to enable them to lawfully pursue their claims against the corporation in those other courts beyond the statutory three-year winding-up period. The Court of Chancery had granted summary judgment in favor of the corporation, holding that claims filed more than 10 years after the date of dissolution were time-barred and should be dismissed, and claims filed less than 10 years after the date of dissolution could proceed without a court-appointed receiver.

By Barry M. Klayman and Mark E. Felger

7 minute read

December 18, 2013 | Delaware Business Court Insider

Does the Bankruptcy Code allow for triangular setoffs in swap and repurchase agreements after commencement of the debtor's bankruptcy case? In Sass v. Barclays Bank (In re American Home Mortgage Holdings), Adv. Proc. No. 11-51851 (CSS) (Del. Bankr. Nov. 8, 2013), the court held that the Bankruptcy Code does not allow parties to set off non-mutual obligations, regardless of whether the agreements are subject to the safe harbor provisions of 11 U.S.C. §§ 559-661.

By Barry M. Klayman and Mark E. Felger

6 minute read

November 13, 2013 | Delaware Business Court Insider

Is electricity a good for purposes of establishing an administrative priority claim under Section 503(b)(9) of the U.S. Bankruptcy Code?

By Barry M. Klayman and Mark E. Felger

7 minute read

October 09, 2013 | Delaware Business Court Insider

The Delaware General Corporation Law, like the business corporation law of most states, provides in Section 223(a) that vacancies on a corporate board can be filled through appointment of new directors by the existing directors unless the certificate of incorporation or bylaws provide otherwise. However, unlike the corporation law in other states, Section 223(c) of the DGCL allows stockholders in certain circumstances to petition the Court of Chancery to direct that a special stockholders' meeting take place in order to fill the vacancies through a stockholder vote.

By Barry M. Klayman and Mark E. Felger

6 minute read

September 11, 2013 | Delaware Business Court Insider

It is not often that the Delaware Supreme Court rejects the specific arguments advanced by an appellant and then decides the matter in the party's favor on grounds not asserted by that party but considered sua sponte by the court. Such was the case in Levey v. Brownstone Asset Management, LP, No. 551, 2012 (Del. Aug. 27, 2013), wherein the court reversed the decision of the Court of Chancery and remanded for further proceedings "in the interest of justice."

By Barry M. Klayman and Mark E. Felger

7 minute read

September 11, 2013 | Delaware Business Court Insider

It is not often that the Delaware Supreme Court rejects the specific arguments advanced by an appellant and then decides the matter in the party's favor on grounds not asserted by that party but considered sua sponte by the court.

By Barry M. Klayman and Mark E. Felger

8 minute read

August 14, 2013 | Delaware Business Court Insider

Two recent bankruptcy cases decided on the same day by the same judge dealt with motions to amend the complaints in preference actions. Both cases illustrate the court's application of the relation-back doctrine, with differing results. Along the way, the court addressed the requirements for proper service and equitable tolling of the statute of limitations.

By Barry M. Klayman and Mark E. Felger

8 minute read

July 10, 2013 | Delaware Business Court Insider

The Worker Adjustment and Retraining Notification Act (WARN Act) provides that an employer may not order a plant closing or mass layoff until the end of a 60-day period after the employer serves written notice of such an order to each affected employee. The purpose of the act is to protect workers and their families by providing them with advance notice of a layoff. Because employee layoffs are a necessary condition to WARN Act liability, and layoffs frequently presage a corporation's demise, plaintiffs frequently attempt to recover from affiliates like a parent company or lender. Two recent decisions from the Delaware bankruptcy and district courts illustrate how the courts deal with such suits.

By Barry M. Klayman and Mark E. Felger

9 minute read

June 12, 2013 | Delaware Business Court Insider

On March 28, 2012, we wrote about a bankruptcy court decision voiding a nondebtor parent company's revocation of its own S corporation status, which had the effect of terminating its debtor subsidiary's "qualified Subchapter S subsidiary" (QSub) status, as an unlawful transfer of the debtor subsidiary's property in violation of Sections 362 and 549 of the Bankruptcy Code.

By Barry M. Klayman and Mark E. Felger

10 minute read

May 08, 2013 | Delaware Business Court Insider

A recent Chancery Court decision underscores the broad scope of a director's right to information, even where he is a plaintiff in litigation action against the corporation. In Kalisman v. Friedman, C.A. No. 8447-VCL (Del. Ch. Apr. 17, 2013), the court held that a corporation could not assert the attorney-client privilege or work-product doctrine to withhold documents from a director who had been frozen out of the deliberative process on a controversial recapitalization plan.

By Barry M. Klayman and Mark E. Felger

8 minute read