Ninth Circuit Affirms Dismissal in Bankruptcy Fraud Case

Munger, Tolles & Olson represented Hancock Park Capital II, LP and one of its managers in obtaining affirmance of the dismissal of all claims brought by the bankruptcy trustee of Fitness Holdings, a former subsidiary of Hancock Park, on Nov. 8, 2016.

The trustee sought to recover a pre-bankruptcy debt repayment of approximately $12 million from Fitness Holdings to Hancock Park, its sole shareholder, arguing that the underlying debt should be “recharacterized” as equity. The U.S. Court of Appeals for the Ninth Circuit affirmed the district court’s conclusion the trustee’s complaint failed to allege facts supporting recharacterization and therefore all of the trustee’s claims failed.

The Munger Tolles team included Todd J. Rosen and Bradley R. Schneider.