Official Committee of Unsecured Creditors v. Austin Financial Services, Inc. (In Re KDI Holdings, Inc.)

How courts have described this case

Verbatim parenthetical descriptions written by other courts when citing this decision. Ranked by citation-network relevance.

• holding that a party will be held to an insider standard where it is found that the party dominated and controlled the debtor.
• the relevant factors include control over the debtor’s voting stock, personnel decisions and which creditors get paid
• the logical inference that the general creditors will be less likely to recover because of a specific creditor’s leveraging of the debtor’s assets satisfied the pleading requirements
• “[T]he Committee has alleged sufficient facts with regard to Austin’s and Schneider’s insider status through domination and control to render the in pari delicto defense inapplicable in this case”
• \[T]he allegations must indicate something more than the monitoring of a debtor's operations and proffering advice to management ....\
• “To establish domination and control by a lender, the allegations must indicate something more than the monitoring of a debtor’s operations and proffering advice to management, even where the lender threatens to withhold future loans should the advice not be taken.”

Source: CourtListener parenthetical corpus (CC0).