Spicer v. Laguna Madre Oil & Gas II LLC, et al.

Texas Wyoming Drilling, Inc. (TWD) filed a voluntary petition for bankruptcy under Chapter 11 and filed its disclosure statement and plan, which eliminated all of TWD's shareholders' stock interests in TWD. Central to this dispute were the terms of the plan and statement; namely, whether the terms preserved TWD's claims against Laguna Madre Oil & Gas II, LLC et al. A few months after confirmation of the plan, TWD sued 32 of its former shareholders, including appellants here, for pre-petition dividend payments that were allegedly fraudulent transfers under 11 U.S.C. 544, 548, and 550, and the Texas Business and Commerce Code, alleging that the former shareholders had received dividends and other transfers equaling millions of dollars while TWD was insolvent (Avoidance Actions). Laguna subsequently appealed the bankruptcy court's denial of its motion for summary judgment. The court held that the bankruptcy court properly denied Laguna's motion for summary judgment because the plan adequately preserved the Avoidance Actions and the claims were not barred by judicial estoppel or res judicata. Accordingly, the court affirmed the judgment. View "Spicer v. Laguna Madre Oil & Gas II LLC, et al." on Justia Law