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Cooley Team Prevails for Unsecured Creditors in Retail Bankruptcy Dispute
| Source: Cooley Godward Kronish LLP
NEW YORK, NY -- (MARKET WIRE) -- April 5, 2007 -- Cooley Godward Kronish LLP's bankruptcy and
restructuring practice has prevailed for the unsecured creditors of
Norstan's, a women's budget retailer, in the denial of a motion to dismiss
a $67 million fraudulent transfer lawsuit arising out of a $53 million
leveraged buyout and an earlier distribution of $14 million to insider
shareholders.
The decision was issued in the U.S. Bankruptcy Court's Eastern District of
New York on March 30 by Chief U.S. Bankruptcy Judge Carla E. Craig. The
lawsuit, on behalf of the unsecured creditors, asserts that in the months
before declaring bankruptcy, Norstan's made distributions of $14 million to
the company shareholders and thereafter leveraged its own stock to transfer
$53 million to those same shareholders.
"It is the view of unsecured creditors that these transfers were
constructively fraudulent," said Cooley partner Ronald R. Sussman. In
addition to Sussman, Cooley Partner Lawrence C. Gottlieb and Associates
Jeff Cohen, Seth Van Aalten and Michael Klein advised on the matter.
Cooley is one of the top ten U.S. legal advisors on bankruptcy and
restructuring matters, according to leading business publication The Deal.
The firm represents secured lenders, official and unofficial creditors'
committees, equity committees, employee and retiree committees, tort
committees, investors in distressed situations, debtors, companies and
governmental entities in the negotiation of complex reorganizations.
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