Judge Blasts Defendant for Ignoring Discovery Obligations and More

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January 1, 2026

Judge Blasts Defendant for Ignoring Discovery Obligations and More

The Bankruptcy Strategist

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A recent decision by Bankruptcy Judge Brendan Shannon was peppered with some harsh words for a defendant in an adversary proceeding. Judge Shannon said the party’s “failure to perform basic discovery responses and participation in litigation … has been breathtaking. I have seen a lot, but I have not seen strategic and patterned failure to provide meaningful, substantive responses to very basic and cogent questions that have gone on for more than a year.” In re Byju’s Alpha, Case No. 24-10140, Adv. Pro. No. 25- 50526, 2025 Bankr. LEXIS 3034, at *16 (Bankr. D. Del. Nov. 20, 2025).

Judge Shannon also said, “the circumstances of this case are, frankly, unique and unlike anything the undersigned has encountered before, thereby making [the] relief in this case richly warranted.” Id. at *28.

These comments were made in a case that was filed after the fraudulent transfer of $533 million of the debtor’s funds, plus other proceeds. The plaintiffs — the debtor and another entity — sued defendants for breaches of fiduciary duty, aiding and abetting breach of fiduciary duties, accounting, conversion, and civil conspiracy.

To continue reading Daniel Lowenthal's article in The Bankruptcy Strategist, please click here.

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