SPCP Group v. Eagle Rock Field Services
U.S. DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
Judge Paul Crotty
In 2009 SPCP Group paid Eagle Rock Field Services and Eagle Rock Operating (collectively Eagle Rock) some $3 million to rights of claims worth $3.9 million in connection with SemCrude's bankruptcy in 2008. Bankruptcy court reduced the claims and Eagle Rock refused SPCP's demand to cover a $180,429 shortfall following a settlement in which SPCP received a cash payment and a general unsecured claim for the claims assigned to it by Eagle Rock. At the core of SPCP's lawsuit against Eagle Rock was the meaning and scope of a carve-out provision within the assignment agreements, which deemed certain objections to be "Impairments" and which required impaired claims to be repurchased by Eagle Rock. Finding the assignments unambiguous under governing New York contract law, the court granted Eagle Rock's motion to dismiss SPCP's complaint. In finding SPCP's causes of action precluded by the exclusion provision in Section 7 of the subject assignments, the court concluded that administrative agent Bank of America's Feb. 11, 2010, objections that SemCrude had received the petroleum condensates on which Eagle Rock's claims were based, could not form the basis of an "Impairment."