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IN RE DELTA FINANCIAL CORP.

Bankruptcy No. 07-11880 (CSS). Adversary No. 08-50287 (CSS). Docket Nos. 24, 27, 30, 34, 41.

398 B.R. 382 (2008)

In re DELTA FINANCIAL CORPORATION, et al., Debtors. Delta Financial Corporation, Plaintiff, v. Westchester Surplus Lines Insurance Company, United States Fire Insurance Company and Axis Specialty Insurance Company, Defendants.

United States Bankruptcy Court, D. Delaware.

December 15, 2008.

Attorney(s) appearing for the Case

John E. James, Richard L. Horwitz, Gabriel R. MacConaill Potter, Anderson & Corroon, LLP, Wilmington, DE, Matthew L. Jacobs (Argued), Ronald R. Peterson (Argued), Megan A. Byrnes, Jenner & Block, LLP, Washington, D.C., for Delta Financial Corporation.

Carl N. Kunz, III, Thomas M. Horan, Douglas N. Candeub, Morris James LLP, Wilmington, DE, Joseph K. Powers (Argued), Edward J. Kirk, J. Gregory Lahr, Sedgwick, Detert, Moran & Arnold, LLP, New York, NY, for Westchester Surplus Lines Insurance Company.

Kevin F. Brady, Christina Thompson, Marc J. Phillips, Connolly Bove Lodge & Hutz, LLP, Wilmington, DE, for Axis Specialty Insurance Company/Unites States Fire Insurance Company.

Gary P. Seligman (Argued), Howard Anglin, Wiley Rein LLP, Washington, D.C., for Axis Specialty Insurance Company.

Joan M. Gilbride (Argued), Kaufman, Borgest & Ryan, LLP, Valhall, NY, for Unites States Fire Insurance Company.

OPINION

SONTCHI, Bankruptcy Judge.

INTRODUCTION

This is an action for a declaratory judgment that the defendants are required to provide insurance coverage to the debtors and certain of the debtors' officers and directors for defense costs and indemnification in connection with a pending state court action.

Delta Financial Corporation, the lead Chapter 11 debtor in the underlying bankruptcy cases, and certain of its officers and...

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