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PE Firm's Misdeeds Bankrupted ER Operator, Chancery Told

Law360 (May 20, 2019, 4:39 PM EDT) -- A Chicago-based private equity firm's self-dealing and abuse of its role as Adeptus' controlling stockholder led the emergency room operator into financial ruin and bankruptcy in 2017, Adeptus' bankruptcy trustee claims in a Delaware Chancery suit filed Friday.

Drivetrain LLC, as trustee of a litigation trust set up as part of the Chapter 11 with standing to pursue claims against Adeptus Health Inc.'s former officers and insiders, claims that entities set up by private equity firm Sterling Partners breached their fiduciary duty of loyalty to Adeptus by pursuing "rapid growth initiatives" and other transactions aimed at benefiting Sterling that ended up...

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