Logourl black

Metropolitan Life Insurance Company v. RJR Nabisco, Inc.

United States District Court for the Southern District of New York
716 F.Supp. 1504 (S.D.N.Y. 1989)


Metropolitan Life Insurance Company (MetLife) and Jefferson-Pilot Life Insurance Co. (plaintiffs), two “sophisticated investors,” owned bonds in RJR Nabisco, Inc. (RJR) (defendant). There were express provisions in the bond indentures that allowed RJR to merge and/or sell its assets, as well as to assume additional debt. There were no express provisions that restricted RJR’s assumption of new debt or that required a payout on the bonds upon a leveraged buyout. RJR produced MetLife memoranda indicating that MetLife, through past experiences with leveraged buyouts, recognized an inability to force a payout without an express provision in the bond indenture. RJR accepted a leveraged buyout proposal that significantly reduced the value of the plaintiffs’ bonds. The plaintiffs brought suit, alleging that RJR breached an implied covenant of good faith and fair dealing by taking on the additional debt necessary to approve the buyout and thereby allowing the value of the bonds to drop. RJR moved for summary judgment.

Rule of Law

The rule of law is the black letter law upon which the court rested its decision. To access this section, start your 7-day free trial of Quimbee for Law Students.


The issue section includes the dispositive legal issue in the case phrased as a question. To access this section, start your 7-day free trial of Quimbee for Law Students.

Holding and Reasoning (Walker, J.)

The holding and reasoning section includes:

  • A “yes” or “no” answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

To access this section, start your 7-day free trial of Quimbee for Law Students.

Here's why 90,000 law students rely on our case briefs:

  • Reliable - written by law professors and practitioners not other law students.
  • The right length and amount of information - includes the facts, issue, rule of law, holding and reasoning, and any concurrences and dissents.
  • Access in your class - works on your mobile and tablet.
  • 12,195 briefs - keyed to 164 casebooks.
  • Uniform format for every case brief.
  • Written in plain English - not in legalese and not just repeating the court's language.
  • Massive library of related video lessons - and practice questions.
  • Ability to tag case briefs in an outlining tool.
  • Top-notch customer support.
Start Your Free Trial Now