Bill on Bankruptcy: Detroit Shows Need for Amending Bankruptcy Law
On September 12, 2024, the United States Court of Appeals for the Eighth Circuit reversed a trial court decision that had rejected a bank’s assertion of the in pari delicto defense to aiding and abetting claims brought by the...more
In Seitz v. Marcum LLP, 2024 N.Y. Slip Op. 51141(U) (Sup. Ct., N.Y. County Aug. 30, 2024) (here), Justice Robert R. Reed of the New York County Commercial Division addressed the doctrine of in pari delicto, which “bars a...more
It’s time for a primer on the Wagoner rule and the in pari delicto defense, two concepts that arise when a debtor’s fraud leads to bankruptcy. Trustees who replace a debtor’s management often sue those involved in the...more
The Situation: In Merrimack College v. KPMG LLP, a college sued its independent auditor for the auditor's failure to report fraud by the college's financial aid director. The Result: The Massachusetts Supreme Judicial...more
Failure to raise an issue at the trial court level is generally considered a waiver of that issue on appeal. Notwithstanding, state courts recognize certain circumstances when raising an issue for the first time on appeal...more
Just what must be alleged for claims for breach of fiduciary duty to proceed past initial pleadings and into meaningful fact development? In a recent decision, the United States Bankruptcy Court for the Eastern District of...more
In a January 19, 2016 Commercial Division decision by Justice Bransten, the court granted defendants’ motions to dismiss on the grounds of in pari delicto....more
A recent decision of the United States District Court for the Southern District of New York (the “District Court”), affirming a decision of the United States Bankruptcy Court for the Southern District of New York (the...more
The Delaware Supreme Court, in a recent order affirming the opinion of the Delaware Court of Chancery, provided clear guidance about when third-party corporate advisers may raise the in pari delicto defense as a shield to...more
This and the AIG decisions are the leading decisions on when the in pari delicto defense works. The Court carefully summarizes the 3 exceptions to when in pari delecto bars a recovery: (1) the adverse interest exception, (2)...more
The Court of Appeal recently clarified when a party can recover attorney's fees under a real estate purchase contract that is ruled to be illegal. California courts have previously enforced attorney's fees provisions in a...more
Whenever a company tumbles into bankruptcy following the discovery of its management’s financial misdeeds, firms that provided the company with accounting, legal, banking and financial advisory services should prepare to...more