COMMITTED TO ACHIEVING YOUR GOALS
June 28, 2018
Clingman & Hanger Management Associates, LLC, as trustee v. David Knobel et al.
United States District Court for the Southern District of Florida
Storch Amini Obtains $15 Million Settlement for Trustee of Florida Career College
Dear Friends and Colleagues:
We are pleased to announce that Storch Amini has obtained a $15 million settlement for Clingman & Hanger Management Associates, LLC, the liquidating trustee for FCC Holdings, Inc. Prior to its 2014 bankruptcy filing, FCC operated 41 for-profit colleges nationwide. In 2016, Storch Amini brought breach of fiduciary duty claims against six of FCC’s former officers in the United States District Court for the Southern District of Florida. By decision dated January 9, 2018, available here, the District Court found that the trustee’s complaint stated claims for breach of the duty of care and breach of the duty of loyalty stemming from improprieties in the handling of federal student aid that the officers knew of or should have known about. Among other notable rulings, we believe that this decision is one of the few decisions in any jurisdiction to uphold Caremark claims against fiduciaries of Delaware corporations. The case had been scheduled for trial on July 9, 2018, but settled after full fact and expert discovery, briefing on summary judgment and important published rulings on expert testimony. On June 28, 2018, the United States Bankruptcy Court for the District of Delaware approved the settlement.