WASHINGTON, DC, March 17, 2009 ― The Litigation Department recently obtained a significant victory for John Hancock Life Insurance Company when Judge Montgomery in the United States District Court for the District of Minnesota granted Hancock’s motion for summary judgment on each of Plaintiff’s claims.
The action, entitled Bremer Bank, National Association v. John Hancock Life Insurance Company and US Bank, National Association, concerned the foreclosure of a Boeing 757-251 aircraft that was leased, through a leveraged lease transaction, to Northwest Airlines. Plaintiff, an equity participant in the transaction, claimed that its equity interest was improperly extinguished by the actions taken by Defendants after Northwest Airlines filed for bankruptcy in September 2005.
Specifically, Plaintiff claimed that the Defendants breached the “equity squeeze” provision of the leveraged lease transaction documents, arguing that its equity interest in the transaction could not have been foreclosed upon by the Defendants. Plaintiff’s complaint alleged express breaches of contract against the Defendants, breach of the implied covenant of good faith and fair dealing, and a breach of the commercial reasonableness requirements of Article 9 of the New York Uniform Commercial Code.
In August 2008, Defendants moved for summary judgment on all of Plaintiff’s claims while Plaintiff moved for partial-summary judgment against Defendants. Defendants argued that there was no violation of the “equity squeeze” provision of the transaction documents and that all aspects of the foreclosure sale were commercially reasonable under the New York Uniform Commercial Code. Judge Montgomery agreed, finding Defendants' argument to be supported by the text of the transaction documents and relevant New York law. Judge Montgomery thus granted Defendants’ summary judgment motion against all of Plaintiff’s claims and denied Plaintiff’s summary judgment motion in its entirety.
Litigators David Cohen, Daniel DeSouza, Sean Newell, and Lindsay Pinto defended the case on behalf of Hancock.