11th Circ. Nixes Funds' Suit Over CompuCredit Dividends

Law360, New York (April 25, 2012, 6:07 PM EDT) -- The Eleventh Circuit on Wednesday tossed claims brought by hedge funds alleging CompuCredit Holdings Corp. unlawfully handed out dividends to company insiders while in financial distress, ruling a standard no-action clause in the noteholder agreements barred the suit.

A three-judge panel reversed and remanded for dismissal a Georgia federal judge's decision that had denied CompuCredit's motion to dismiss the suit, finding the plain language of the no-action clause stated that noteholders were prohibited from bringing the suit.

“Because we find no persuasive, legally grounded reason to...
To view the full article, register now.
Law360 Pro Say Podcast
Check out Law360's new podcast, Pro Say, which offers a weekly recap of both the biggest stories and hidden gems from the world of law.