REID COLLINS FILES SUIT ON BEHALF OF DURA AUTOMOTIVE CHAPTER 7 TRUSTEE AGAINST LYNN TILTON AND FORMER CFO KEVIN GRADY
On April 18, 2022, Reid Collins filed suit in the Delaware Court of Chancery on behalf of Jeoffrey Burtch, the chapter 7 trustee of Dura Automotive Systems, LLC and its debtor subsidiaries, against Dura’s former CEO, Lynn Tilton, and its former CFO, Kevin Grady. The Trustee alleges that Tilton was motivated by her personal interests relating to her dispute with the Zohar Funds, rather than Dura’s interests, when she abandoned serious bids to purchase Dura for many hundreds of millions of dollars. The Trustee alleges that Tilton then drove Dura into bankruptcy where she tried (unsuccessfully) to acquire Dura at a small fraction of those bids. The Trustee asserts claims for breach of fiduciary duty against Tilton for her self-serving conduct and related claims against Grady for assisting Tilton’s schemes. The Trustee seeks to recover the hundreds of millions of dollars in value that Dura lost after Tilton improperly abandoned the sale, eventually leading to a bankruptcy sale for approximately $65 million.
A copy of the publicly-filed complaint can be found here.
Media coverage can be found here:
- Distressed-Debt Investor Tilton Sued Over Dura Automotive Losses (BloombergLaw)
- Litigation Coverage: Dura Automotive Chapter 7 Trustee Sues Former CEO Lynn Tilton Over ‘Hundreds of Millions’ in Lost Value (Reorg.com)
Prior results do not guarantee a similar outcome.