Argosy Capital Grp. III LP v. Triangle Capital Corp.

OPINION AND ORDER The above-captioned parties are all lenders on a note made by CRS Reprocessing, LLC (“CRS”), a company headquartered in Louisville, Kentucky. In connection with the note, Plaintiffs appointed Defendant Triangle Capital Corporation (“Triangle”) as their “Collateral Agent,” pursuant to which Triangle was to perform any acts necessary to secure the collateral granted to Plaintiffs by CRS.After CRS filed for bankruptcy in 2017, Triangle proposed to loan CRS money in exchange for a first-position lien in the collateral secured by Plaintiffs. Plaintiffs and several other CRS creditors objected repeatedly to this proposal. The bankruptcy court nevertheless approved Triangle’s proposal.Plaintiffs subsequently sued Triangle, claiming that it knowingly misrepresented CRS’s financial status to them, breached its contractual duties as Collateral Agent, and engaged in tortious conduct to pursue its own financial interest at the expense of Plaintiffs’. Triangle now moves to transfer this action to the U.S. District for the Western District of Kentucky pursuant to 28 U.S.C. §§1404(a) and 1412. For the reasons that follow, Triangle’s motion is GRANTED.I. BACKGROUND¹Plaintiffs and Triangle (collectively, the “noteholders”) are lenders on a loan made to CRS, evidenced by a “Second Amended and Restated Senior Secured Subordinated Note,” dated February 10, 2015. Doc. 1 9. In connection with that note, the noteholders entered into a security agreement with CRS (“Security Agreement”), pursuant to which CRS granted the noteholders a security interest in certain collateral, including all of CRS’s “cash,” “cash equivalents,” and “accounts receivable” (collectively, CRS’s “cash accounts”). See id.

10, 12; see also Doc. 1-1 at 2.As part of the Security Agreement, the noteholders appointed Triangle as their “Collateral Agent.” Id. In so doing, the noteholders granted Triangle a security interest in all their rights, title, and interest in CRS’s cash accounts to secure the accounts — and, in the event of CRS’s default, to execute thereupon — for the noteholders’ benefit. Doc. 1