Orchard Trustee's Suit Over $310M Payout Survives

Law360, New York (March 1, 2012, 8:53 PM EST) -- A federal judge on Thursday refused to toss a suit by a trustee for Orchard Brands Corp. subsidiaries looking to claw back a $310 million acquisition-related dividend from Golden Gate Capital Corp. funds that allegedly caused the companies' insolvency, calling a primary dismissal argument illogical.

Looking to kill the suit's fraudulent transfer claims, the Golden Gate funds, which own a controlling stake in Orchard, and other defendants argued that the subsidiaries didn't control that money because credit agreements associated with the retailer's 2007 leveraged buyout of...
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