Credit Suisse Securities (USA) Seeks Dismissal of QHC Litigation Trust’s Complaint to Recover Alleged $20-30M in Investment Banking Fees
January 14, 2022, District of Delaware – Defendant Credit Suisse Securities (USA) LLC moves for an order pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure to dismiss with prejudice all claims asserted against it in the complaint filed by Plaintiffs Daniel H. Golden, as Litigation Trustee of the QHC Litigation Trust, and Wilmington Savings Fund Society, FSB as Indenture Trustee for the bankruptcy estates of Quorum Health Corporation, et al. (QHC).
The Trustee’s complaint contains various causes of action based on sections 542, 543, 544 through 548, 550, or 553 of the Bankruptcy Code, relating to “fraudulent transfers”, “illegal dividends”, “aiding and abetting breach of fiduciary duty”, “unjust enrichment”, et al.
Defendant’s Motion alleges that the Trustee’s complaint should be dismissed for “failure to state a claim” as to Credit Suisse. Specifically, Credit Suisse argues that the Trustee’s claims to avoid and recover the alleged $20-30 million in investment banking fees paid to Credit Suisse are “barred” by the Bankruptcy Code’s “safe harbor” provision because they are transfers made to a “financial participant” (Credit Suisse) “in connection with a securities contract”.
The Motion also claims that the Trustee fails to plead the existence of any “triggering creditors” as required under § 544 of the Bankruptcy Code. Defendant’s Motion further argues that Plaintiff’s constructive fraudulent transfer claims should be dismissed for the reason that the complaint “fails to allege” that QHC did not receive “reasonably equivalent value” from Credit Suisse.
In re: QUORUM HEALTH CORPORATION, et al. Case No. 21-51190 (BLS)