The Chancery opinion in Andrikopoulos v. Silicon Valley Innovation Company, LLC, C.A. No. 9899-VCP (Del. Ch. July 30, 2015), addressed the priority of an advancement claim in the context of a receivership under Delaware law. Bottom line: The court ruled, on this issue of first impression, that the claims for advancement in this case are not entitled to administrative priority, and should be treated as pre-petition, unsecured claims without administrative priority.
The odd procedural context of this case is not likely to be replicated often for the average practitioner of corporate or commercial litigation, but the court does refer to some of the well-known and frequently applied Delaware principles and Delaware policy regarding advancement for directors and officers. I suggest that this opinion may be most useful to those dealing with the priority of claims generally in receiverships under Delaware law, as well as bankruptcy lawyers to the extent the court refers to bankruptcy by analogy to a receivership, and cites to many decisions of bankruptcy courts that have dealt with advancement under Delaware law (though the decision refers to some courts that conflate the concepts of advancement and indemnification–which is not uncommon among some courts and lawyers alike.)