Opinion ID: 561305
Heading Depth: 2
Heading Rank: 4

Heading: The Possibility of Bringing Claims Against Envirodyne in the Bankruptcy Proceeding

Text: 67 Envirodyne has two remaining arguments to support its claim that the settlement release should operate to relieve it from liability for the plaintiffs' lost pension benefits. Rather than addressing whether or not Envirodyne actually is released, these arguments concern other provisions in the Settlement Agreement. Defendant's first argument addresses language preventing any and all claims    that have been asserted or could have been asserted in the Chapter 11 bankruptcy proceeding. (Settlement Agreement at 4, reprinted in Plaintiff's Br. at A-21). The question, then, is whether a claim against Envirodyne could have been asserted in the Chapter 11 bankruptcy proceeding. 68 At first glance, it would appear that the answer to the question is yes. This Court has held previously that alter ego claims may be brought in bankruptcy by the trustee of a bankrupt corporation, Koch Refining v. Farmers Union Central Exchange, Inc., 831 F.2d 1339, 1346 (7th Cir.1987). However, the Court recognized that trustees had standing to bring only those claims which apply to all creditors of the debtor corporation generally. Id. at 1349. As the Court in Koch Refining stated: If the liability is to all creditors of the corporation without regard to the personal dealings between such officers and such creditors, it is a general claim, id. Alternatively, the Court recognized that the trustee has no standing to bring personal claims of creditors. A cause of action is 'personal' if the claimant himself is harmed and no other claimant or creditor has an interest in the cause, id. at 1348 (emphasis in original). 69 In the Chapter 11 proceeding, In re Wisconsin Steel Company, Nos. 80 B 3766 through 80 B 3773, Adversary No. 81 A 0442, 1989 WL 39995 (Bktcy.N.D.Ill.), the former employees of the Division comprised only one of the several creditors in the proceeding. They were the only creditors to assert claims for lost pension benefits. Their claims are properly described as personal claims and not general claims. The logic of Koch Refining therefore leads necessarily to the conclusion that plaintiffs' alter ego claims against Envirodyne could not have been asserted in the bankruptcy proceeding because they were not claims of the creditors generally but ERISA claims unique to the former employees. 70