Adelphia Recovery Trust v. Goldman, Sachs & Co.
748 F.3d 110
2d Cir.2014Background
- Adelphia Recovery Trust sues Goldman, Sachs & Co. for fraudulent conveyance under 11 U.S.C. § 548(a)(1)(A) and § 550(a).
- The dispute centers on whether payments to Goldman were made from the debtor as property, or from an ACC subsidiary via a Concentration Account.
- During bankruptcy, asset ownership and intercompany transfers were coordinated under the Bank of Adelphia Paradigm and reflected in asset schedules.
- The asset schedules consistently treated the Concentration Account as owned by Adelphia Cablevision LLC (an ACC subsidiary), not by ACC itself.
- The district court granted summary judgment in Goldman’s favor, and the Adelphia Recovery Trust appeals seeking to overcome this through judicial estoppel.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the amended complaint states a valid fraudulent transfer claim. | Adelphia Recovery Trust contends ACC owned the Concentration Account and funds; transfers were to Goldman from ACC. | Goldman argues the payments came from Adelphia Cablevision LLC, a subsidiary, not ACC, so no debtor-property transfer. | Yes; the claim is barred by judicial estoppel in the bankruptcy context. |
| Whether judicial estoppel bars relitigating asset ownership after bankruptcy plan confirmation. | Trust asserts ownership changed post-plan; estoppel should not apply. | Bankruptcy process relied on asset schedules; inconsistent later ownership claims undermine finality. | Yes; judicial estoppel applies to bar the claim. |
Key Cases Cited
- Matter of Southmark Corp., 49 F.3d 1111 (5th Cir. 1995) (ownership attribution in cash management context cited for estoppel concerns)
- In re Amdura Corp., 75 F.3d 1447 (10th Cir. 1996) (commingled funds; parent ownership argument rejected in this context)
- New Hampshire v. Maine, 532 U.S. 742 (2001) (standard and purpose of judicial estoppel; context-specific factors)
- DeRosa v. Nat’l Envelope Corp., 595 F.3d 99 (2d Cir. 2010) (recognition of estoppel elements varies by context)
- Maharaj v. BankAmerica Corp., 128 F.3d 94 (2d Cir. 1997) (does not always require unfair advantage to apply estoppel)
- Mitchell v. Washingtonville Cent. Sch. Dist., 190 F.3d 1 (2d Cir. 1999) (estoppel flexibility in application)
- Wight v. BankAmerica Corp., 219 F.3d 79 (2d Cir. 2000) (protecting judicial process; estoppel integrity focus)
- Chartschlaa v. Nationwide Mut. Ins. Co., 538 F.3d 116 (2d Cir. 2008) (importance of asset schedules and bankruptcy finality)