October 14, 2016
Curtis Successfully Defended Directors of Sabine Oil & Gas Corporation in Sabine’s Chapter 11 Cases
Curtis has successfully defended a group of officers and directors of Sabine in an adversary proceeding and appeal in the Chapter 11 cases of Sabine Oil & Gas Corp. (“Sabine”) in the United States Bankruptcy Court for the Southern District of New York before Judge Shelley C. Chapman. Sabine is an independent oil and natural gas company engaged in the acquisition, development, exploitation and exploration of oil and natural gas properties in various plays located in Texas; namely, the Eagle Ford Shale in south Texas, Granite Wash in north Texas, and the Cotton Valley Sand and Haynesville Shale in the eastern part of the state.
The Official Committee of Unsecured Creditors (the “Committee”) sought standing to assert, among other claims, breach of fiduciary duty claims arising out of the multi-billion dollar merger between Sabine Oil & Gas LLC and Forest Oil Corporation against the Sabine directors represented by Curtis, among other parties. Following an evidentiary hearing on the Committee’s motion for standing, the United States Bankruptcy Court for the Southern District of New York agreed with Curtis’ argument that the Committee’s proposed claims against the Sabine officers and directors were not colorable and therefore denied standing.
Curtis then successfully defended certain Sabine officers and directors on appeal to the United States District Court for the Southern District of New York, which affirmed the Bankruptcy Court’s denial of the motion for standing. Although the Committee has appealed the decision with respect to certain claims to the United States Court of Appeals for the Second Circuit, it has abandoned its claims against the Sabine officers and directors. The Bankruptcy Court confirmed the Debtors Chapter 11 Plan of Reorganization and denied the Committee’s motion to stay confirmation.
The Curtis team on this matter includes Restructuring and Insolvency Partner Steven J. Reisman, Restructuring and Insolvency Litigation Partner Theresa A. Foudy, Litigation Partner Michael J. Moscato and Litigation Associate Kevin A. Meehan.