Date Submitted: September 11, 2013.
Eric J. Monzo, Esquire Morris James LLP.
John L. Reed, Esquire Scott B. Czerwonka, Esquire Andrew H. Sauder, Esquire DLA Piper LLP (US).
Plaintiff Spring Real Estate, LLC ("Spring Capital") seeks to recover on a $99, 057.50 default judgment (the "RT Default Judgment") entered against Defendant RayTrans Distribution Services, Inc. ("RayTrans"), a dissolved Illinois corporation. Before it was dissolved, RayTrans sold substantially all of its assets to Defendant Echo/RT Holdings, LLC ("Echo/RT"), a Delaware limited liability company, through an Asset Purchase Agreement dated June 2, 2009 (the "Purchase Agreement"). Defendant Echo Global Logistics, Inc. ("Echo") guaranteed the performance of certain obligations of Echo/RT, its wholly-owned subsidiary, under the Purchase Agreement.
Spring Capital is attempting to collect on the RT Default Judgment from Echo/RT, Echo, and RayTrans. RayTrans Holdings, Inc. ("RayTrans Holdings") and James A. Ray ("Ray") are named as Nominal Defendants. Spring Capital asserts two claims for declaratory judgment against Echo/RT and Echo (together, the "Echo Defendants"): first, that they have successor liability for the RT Default Judgment under the Purchase Agreement or under Delaware law (the "Successor Liability Claim"); and second, that they are liable for the RT Default Judgment under the Illinois Business Corporation Act (the "Illinois Claim"). Spring Capital also alleges that the Echo Defendants are liable for the RT Default Judgment because the Purchase Agreement was a fraudulent transfer under Delaware and Illinois law (the "Fraudulent Transfer Claims").
The Echo Defendants have moved to dismiss all four claims under Court of Chancery Rule 12(b)(6) for failure to state a claim (the "12(b)(6) Motion"). For the following reasons, the Court grants the 12(b)(6) Motion.
A. The RT Default Judgment
Sierra Concrete Design, Inc., and Trevi Architectural, Inc. (together, the "Debtors") filed for Chapter 7 bankruptcy on August 29, 2008. In the ninety days preceding their bankruptcy filings, the Debtors made five payments totaling $98, 807.50 to RayTrans. On July 29, 2010, the trustee for the Debtors' estates filed a petition against RayTrans to recover that sum, alleging the payments were in violation of the bankruptcy laws. RayTrans did not answer or otherwise respond to the petition, leading to entry of the RT Default Judgment on July 21, 2011. Spring Capital purchased the RT Default Judgment from the Debtors' estates on August 20, 2012, and the RT Default Judgment remains unpaid.
B. The Transaction Between the Echo Defendants and RayTrans
Spring Capital alleges generally that Echo/RT is "jointly and severally liable" for the RT Default Judgment "[a]s RayTrans's successor in liability." The specific allegations of how Echo/RT is liable for the RT Default Judgment are not only internally inconsistent, but also in conflict with the Purchase Agreement.
Initially, Spring Capital claims the assumption of liability was "pursuant to the June 2, 2009 Agreement, " an allegation it supports by citation to the Purchase Agreement. At this point, it also recognizes that "Echo guaranteed payment and Echo/RT's performance of the June 2, 2009 Agreement." But, subsequently, Spring Capital alleges the Echo Defendants assumed RayTrans's liability through a merger, citing to a June 10, 2009, Echo press release announcing the transaction (the "Press Release") for support. Several other allegations in the Complaint suggest the transaction was a merger—in fact, Spring Capital even implies that the Purchase Agreement contemplated a merger.
Spring Capital makes generalized allegations about the assets and liabilities Echo/RT assumed in the transaction with RayTrans. The single specific allegation is that the liabilities Echo/RT assumed included
those directly relating to RayTrans's network of skilled transportation professionals and carriers that relate to RayTrans's specialty in flatbed, over-sized, auto-haul and other specific services, as well as traditional dry van brokerage, coupled with ...