Necco Trustee Says Board Nixed Sweet Prebankruptcy Deal

Law360, Boston (September 4, 2018, 1:13 PM EDT) -- The trustee representing the once iconic but now bankrupt New England Confectionery Co., better known as Necco, sued the company's board of directors Friday in Massachusetts federal court alleging they committed a gross breach of fiduciary duty by ignoring a promising buyout offer in order to benefit conflicted board members.

The company was purchased by a limited liability company called ACAS LLC for $57 million in 2007 and proceeded to bleed money while stacking its board of directors with ACAS employees, the complaint from bankruptcy trustee Harry B. Murphy alleges. Ares Capital Corporation bought ACAS and its portfolio in 2016, the complaint...

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