Quote:
Originally posted by Flinty_McFlint
Do you think that the management committee could be exposed to additional lawsuits from creditors and partners for tanking the firm without proper authority--perhaps causing additional damage that it wouldn't have normally taken, such as the impairment of collecting on outstanding receivables, loss of additional revenue, that sort of crap? I'd be interested in hearing a litigator's thoughts.
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Thanks for all the warm fuzzies. It's nice to see everyone again, now that I'm finished with my extended snipe hunt.
Without thinking this through much, or giving it much analysis, or allowing anyone to rely on this as advice.... (after all, if I wanted to do research or serious reflection before mouthing off, I would just work instead of coming to the boards), I would say this:
I'd be surprised if the Brobeck p-ship agreement allowed dissolution without a partner vote. OTOH, I'm surprised anyone would carry that much debt, so what do I know? Maybe the agreement allowed dissolution by the committee under extraordinary circumstances, i.e. being near-busted.
Assuming the committee exceeded its authority, they could be on the hook (maybe with insurance, maybe without). Probably not to creditors -- unlikely they have a duty to creditors, and the big creditors (Citibank, landlord) have personal guarantees anyway. But maybe to other partners. A tough and expensive claim to take all the way, I would guess (for a host of reasons I won't go into here), but one that might have some staying power (i.e., enough to get past summary judgment in SF Superior.
Overall, among the most interesting things to me is the number of lawsuits, workouts, etc. etc. etc. that are stemming from the Brobeck collapse, starting from the suits by and against Tower Snow. Lawyers throughout the Bay Area will be feeding off this carcass for some time to come.
In other words, Brobeck died so that others could live.
