IN RE LJM2 CO-INVESTMENT, L.P.

No. C.A. 300-N.

866 A.2d 762 (2004)

In re LJM2 CO-INVESTMENT, L.P. Limited Partners Litigation.

Superior Court of Delaware, New Castle County.

Decided: December 21, 2004.


Attorney(s) appearing for the Case

Alan J. Stone, Esquire, David J. Teklits, Esquire, Thomas W. Briggs, Jr., Esquire, Natalie J. Watson, Esquire, Morris, Nichols, Arsht & Tunnell, Wilmington, Delaware; Thomas J. Hall, Esquire, Janice A. Payne, Esquire, Benjamin C. Rubinstein, Esquire, Chadbourne & Parke, LLP, New York, New York, Attorneys for Plaintiffs, LJM2 Liquidation Statutory Trust B and Edward N. Meyer.

Michael D. Goldman, Esquire, Peter J. Walsh, Jr., Esquire, Melony R. Anderson, Esquire, Potter Anderson & Corroon, LLP, Wilmington, Delaware; Joseph M. McLaughlin, Esquire, Michelle B. Cherande, Esquire, Simpson Thacher & Bartlett LLP, New York, New York, Attorneys for Defendants Gordon and Margaret Hargraves.

John L. Reed, Esquire, Matt Neiderman, Esquire, Duane Morris LLP, Wilmington, Delaware; Oscar Garza, Esquire, Michael R. Williams, Esquire, Gibson, Dunn & Crutcher LLP, Irvine, California, Attorneys for Defendant ML IBK Positions, Inc.

Frederick B. Rosner, Esquire, Jaspan Schlesinger Hoffman LLP, Wilmington, Delaware; Ira Lee Sorkin, Esquire, Donald A. Corbett, Esquire, Carter Ledyard & Milburn LLP, New York, New York, Attorneys for ML/LJM2 Co-Investment, L.P.

Martin S. Lessner, Esquire, Sara Beth A. Reyburn, Esquire, Young, Conaway, Stargatt & Taylor LLP, Wilmington, Delaware; Attorneys for Defendants DLJ Fund Investment Partners III, L.P., Merchant Capital, Inc., and Wachovia Investors, Inc.; Mel A. Brosterman, Esquire, Jeremy S. Rosof, Esquire, Strook & Stoock & Lavan LLP, New York, New York; Co-counsel for Defendants DLJ Fund Investment Partners III, L.P. and Merchant Capital, Inc., Paul E. Ridley, Esquire, Sheila Armstrong, Esquire, Kirkpatrick & Lockhart LLP, Dallas, Texas, Co-counsel for Wachovia Investors, Inc.


LAMB, Vice Chancellor:

I.

A limited partnership was formed under Delaware law for the purpose of making investments in businesses related to Enron. Shortly thereafter, the general partner executed a credit agreement with a number of banks. After Enron declared bankruptcy, the bank creditors, acting pursuant to the credit agreement, forced the general partner to make a call upon the limited partners to contribute additional capital within the limit of their...

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