Opinion ID: 223265
Heading Depth: 1
Heading Rank: 2

Heading: ASARCO's Fraud Action

Text: ASARCO is a mining conglomerate that was purchased by Grupo Mexico, S.A.B. de C.V. in 1999. ASARCO's assets at the time included a controlling number of shares in Southern Peru Copper Company (SCC). Grupo Mexico transferred the SCC shares to a holding company it created as a wholly-owned subsidiary of ASARCO, and it created AMC as its own wholly-owned subsidiary. After financial troubles beset ASARCO, Grupo Mexico decided to sell the SCC shares in 2003 by transferring them to AMC. ASARCO was unable to escape its financial difficulties, however, and in 2005 it filed for Chapter 11 bankruptcy. While its bankruptcy proceeding was pending, ASARCO brought an adversary action in the district court against AMC. ASARCO, proceeding in its capacity as debtor-in-possession, alleged that AMC wrongfully caused ASARCO to transfer the SCC shares. The district court conducted a four-week bench trial in 2008 and ultimately found AMC liable for actual fraudulent transfer, aiding and abetting a breach of fiduciary duty, and conspiracy. [2] In April 2009, the district court awarded damages and entered final judgment. The final judgment (SCC Judgment) ordered AMC to transfer approximately 260 million shares of SCC common stock to ASARCO and pay nearly $1.4 billion in damages for past dividends and interest. [3]