Morrison Foerster secured a $65 million settlement for the Thrasio Legacy Trust (the “Trust”) created following Thrasio’s Chapter 11 bankruptcy cases. The proceeds of the settlement will be distributed to former creditors of the Thrasio debtors. Such a recovery was far from certain at the outset of the bankruptcy cases.
The Thrasio debtors initially sought to reorganize pursuant to a chapter 11 plan that offered unsecured creditors a mere $250,000. Upon being selected as counsel to Thrasio’s Official Committee of Unsecured Creditors, MoFo conducted a thorough investigation that uncovered substantial unencumbered estate claims and causes of action. Mofo, on behalf of the Committee, ensured that these claims were adequately preserved pursuant to a revised chapter 11 plan.
Following confirmation of the chapter 11 plan, MoFo continued its investigation and subsequently filed a comprehensive 73 page complaint on behalf of the Trust against eleven Defendants, including several members of Thrasio’s former management team, asserting 26 claims. Following several rounds of motion practice and a formal mediation process, the parties agreed to settle the claims in exchange for a payment of $65 million.
The MoFo litigation team was led by business insolvency + structuring partners Doug Mannal, Theresa Foudy and Bryan Kotliar with invaluable support from complex litigation partners Jamie Levitt and Alexander Lawrence, and associates Janie Buckley, Helen Yan, Laura Miller, and Mercedes Chavez.
“I applaud this tremendous result for our clients,” said Lorenzo Marinuzzi, MoFo’s business insolvency + restructuring chair. “The team deftly ensured these claims were preserved as part of the trust while also successfully litigating these claims on their behalf.”
