Ashby & Geddes Successfully Defends Directors and Stockholders Against Suit Alleging Breach of Fiduciary Duty

Ashby & Geddes, along with lead counsel SNR Denton, successfully defended various directors and certain direct and indirect stockholders of WestPoint International, Inc. (“International”) against allegations of breach of fiduciary duty, aiding and abetting, breach of contract and unjust enrichment in connection with events arising out of the acquisition by International of the assets of WestPoint Stevens, Inc. in a sale pursuant to Section 363(m) of the Bankruptcy Code.  Plaintiffs had been competing bidders in the sale.

Plaintiffs’ latest Complaint raised numerous allegations against the defendants.  Ashby & Geddes & SNR Denton moved to dismiss the Complaint as failing to state a cause of action.  Chancellor Chandler of the Delaware Court of Chancery held in defendants’ favor and dismissed the Complaint in a November 3, 2010 bench ruling.

A team of Ashby & Geddes attorneys from the Corporate Litigation and Counseling practice group, including Stephen E. Jenkins and Richard D. Heins, represented the director/stockholder defendants working closely with a team led by Peter Wolfson and including Richard Zuckerman (the primary drafter of the brief) and Jo Christine Reed of the New York office of SNR Denton.  International was represented by Cozen O’Connor.  The case is captioned Contrarian Funds, L.L.C., et al. v. WestPoint International, Inc., et al., Del. Ch., C.A. No. 2617-CC.  The transcript of Chancellor Chandler’s bench ruling is attached hereto.