Claims Objections Overruled In Seegrid Bankruptcy

On October 27, 2016, Chief Judge Brendan L. Shannon of the Delaware Bankruptcy Court issued an opinion overruling objections to the claims of Seegrid's former CEO. A copy of the Opinion is available here.

This is a relatively short Opinion considering the number of issues that it discusses. The first issue was whether Mr. Horbal, the CEO at the relevant time had authority to use the Debtors; private jet. The second issue was whether Mr. Horbal was under contract at the time of his termination, and whether such termination was for cause.

The first issue hinges upon what the applicable policies of the Debtor were at the time of Mr. Horbal's use of the jet. In this case, the applicable corporate policy required the approval of the CEO prior to using the corporate jet. In this instance, the Court held that as the CEO, Mr. Horbal had the authority to approve of his use of the jet.

The second issue was the more interesting one. The essential facts are as follows: Mr. Horbal was a President at the Debtor prior to becoming its CEO. During his time as a President, he was employed under a contract that provided specific remuneration and benefits upon termination. However, when he accepted the role of CEO, his contract was never revised.

While the Debtors argue that the change in position effected the termination of the agreement, Opinion at *14...