The Examiners Take on Rural/Metro

In the latest installment of The Examiners, our panel of restructuring experts will take on the Delaware Chancery Court’s Rural/Metro ruling.

In March, the preeminent business court found RBC Capital Markets LLC liable for ambulance company Rural/Metro Corp.’s failed 2011 buyout. The court said RBC didn’t disclose a conflict of interest as it pushed the deal in order to pocket significant fees. Rural/Metro sought Chapter 11 protection last August and emerged from bankruptcy on Dec. 31 after winning court approval of a plan to cut its debt load roughly in half.

The ruling, which you can read here, shook up banks and caught the attention of the restructuring world, as each new assignment—in or out of court—raises the issue of disclosure. The decision also forms the basis for the next question we’ve asked our Examiners to tackle:

What does the Delaware Chancery Court’s Rural/Metro ruling mean for advisers to distressed companies? Did the court reach the right conclusion?

We’ll be posting their responses on Bankruptcy Beat in the coming days, so check back soon. In the meantime, you can still catch up on our first Examiners installment. And feel free to weigh in on our current question in the comments section.

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