In an April 24, 2007 order, the United States Bankruptcy Court for the District of Delaware granted certain insurers' motion for leave to pursue a coverage action against the debtor, Federal-Mogul Global, Inc., in New York state court regarding the debtor's asbestos liability. In re Federal-Mogul Global, Inc., No. 01-10578 (Bankr. D. Del. Apr. 24, 2007). The insurer had filed a declaratory judgment action in New York state court against the debtor. In response, the debtor filed an identical action in New Jersey state court. The insurer argued that the court should abstain from hearing a coverage dispute within the bankruptcy proceedings in favor of the New York action. The policyholder objected, asserting that—if the court abstained—it should prefer the more recently filed New Jersey action. Ultimately, the court abstained in favor of the insurers' chosen New York venue.
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Insurers granted relief from automatic stay to pursue a coverage action against Federal-Mogul Global
- Wiley Rein LLP
- May 17 2007
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