In re Moon Group, Inc.
United States Bankruptcy Court for the District of Delaware
2022 WL 4658615 (2022)
- Written by Sean Carroll, JD
Facts
Moon Group, Inc. (Moon) (plaintiff) entered into a revolving-credit agreement with KORE Capital Corporation (Kore) (defendant). Under the agreement, Kore was to make advance payments to Moon based on Moon’s accounts receivable. Kore received a security interest in the accounts receivable in exchange for the payments. Under the agreement, Kore had sole discretion over whether to pay advances to Moon. In July 2021, Kore refused to make an advance payment to Moon. In August 2021, Moon filed for Chapter 11 bankruptcy. In September 2021, Moon filed a complaint against Kore, alleging that Kore breached their agreement by failing to pay the advance. Moon argued that the agreement created a fiduciary relationship between the parties and included an implied covenant of good faith and fair dealing such that Kore could not refuse to make an advance payment in bad faith. In February 2022, the case was converted to Chapter 7, at which point Moon’s trustee assumed prosecution of the complaint against Kore. Given the discretionary language in the agreement, Kore filed a motion to dismiss the complaint for failure to state a claim on which relief could be granted.
Rule of Law
Issue
Holding and Reasoning (Stickles, J.)
What to do next…
Here's why 832,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 46,500 briefs, keyed to 994 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.
