In re Reinz Wisconsin Gasket
Executive Summary
In re Reinz Wisconsin Gasket, LLC is a memorandum opinion of the Delaware Court of Chancery, decided April 2, 2026, in C.A. No. 2022-0859-MTZ.[1] The petitioner, Linda A. Cook, sued individually and as Executor of the Estate of Roland Cook. The opinion describes her as "a plaintiff in an asbestos action brought against the company."[1] She asked the court to nullify the certificate of cancellation of Reinz Wisconsin Gasket, LLC (RWG), a Delaware limited liability company that "dissolved and was cancelled in August 2022."[1]
The court denied the motion. Its holding, in its own words: "Petitioner has failed to carry her burden to prove by a preponderance of the evidence that RWG had assets it failed to set aside for claimants when it dissolved."[1] The ruling covered both kinds of assets a court-appointed receiver had identified: insurance policies and litigable claims.[1] It is a ruling on the proof in this record. The opinion does not discuss asbestos bankruptcy trusts or Section 524(g) at all.[1]
At a Glance
- What was asked: Whether a dissolved and cancelled Delaware LLC's certificate of cancellation should be nullified because the company allegedly dissolved improperly[1]
- Who asked: Linda A. Cook, individually and as Executor of the Estate of Roland Cook, a plaintiff in a Massachusetts federal asbestos suit that named RWG[1]
- Legal test: Whether RWG "had assets it failed to set aside to compensate plaintiffs in pending or likely claims when it dissolved," proved by a preponderance of the evidence[1]
- Receiver: Appointed on August 3, 2023, with limited authority to investigate whether RWG had assets when it filed its notice of dissolution and cancellation[1]
- Insurance policies: The receiver identified thirty-three. The court held none was an asset under Section 18-804 because, on this record, none afforded RWG coverage[1]
- Litigable claims: Coverage, fiduciary duty, and aiding and abetting claims were held to offer RWG no value[1]
- Result: "For the foregoing reasons, the Motion is DENIED."[1]
- What it does not decide: The opinion says nothing about asbestos trusts or Section 524(g), and makes no finding about where the older insurance rights reside[1]
Key Facts
| Item | Detail |
|---|---|
| Case | In re Reinz Wisconsin Gasket, LLC, C.A. No. 2022-0859-MTZ[1] |
| Court | Court of Chancery of the State of Delaware[1] |
| Submitted / decided | October 23, 2025 / April 2, 2026[1] |
| Massachusetts suit filed | August 19, 2021, against twenty-nine defendants; RWG added by amended complaint on December 2, 2021[1] |
| Roland Cook's death | March 27, 2022, while the Massachusetts suit was pending[1] |
| RWG dissolution and cancellation | Notice filed August 30, 2022[1] |
| Delaware petition filed | September 23, 2022[1] |
| Receiver appointed | August 3, 2023 (Peter D. Protopapas)[1] |
| Receiver's final report | March 25, 2025; identified thirty-three insurance policies and several litigable claims[1] |
| Standard of proof | Preponderance of the evidence[1] |
| Disposition | Motion to nullify denied; parties ordered to submit a stipulated implementing order[1] |
What Did the Court of Chancery Decide?
The court framed the case as "a single question: whether a dissolved and cancelled limited liability company's certificate of cancellation should be nullified due to the company's allegedly improper dissolution."[1] It concluded "the petitioner has failed to prove that nullification is warranted."[1]
The opinion explained that the outcome "turns on whether RWG had assets it failed to set aside to compensate plaintiffs in pending or likely claims when it dissolved."[1] To win, the petitioner had to "prove RWG violated the LLC Act by a preponderance of the evidence."[1]
The court summarized its reasoning at the start of the opinion. On the insurance: "The petitioner failed to prove two of the policies exist. For others, the petitioner failed to prove the company had acquired rights to coverage under the policies. For still others, the petitioner failed to prove the policies would be able to compensate for pending or likely claims."[1] On the litigable claims: "A certificate of cancellation will not be nullified based on hypothetical litigable claims that would yield no reasonable recovery."[1]
Because the petitioner did not prove RWG had assets, the court said it "need not address" her request to let the receiver marshal any purported assets.[1]
Who Was the Petitioner and What Did She Ask For?
On August 19, 2021, Linda Cook filed suit in the United States District Court for the District of Massachusetts "against twenty-nine defendants whose products allegedly contributed to her husband's mesothelioma and death."[1] The original complaint did not name RWG. She amended it to add RWG, alleging her husband's exposure to asbestos-containing products while he worked part-time for repair shops from 1976 through 1989, and filed the amended complaint on December 2, 2021.[1] Roland Cook died on March 27, 2022, while that suit was pending.[1]
On September 23, 2022, she filed a Verified Petition in Delaware. The court described it as seeking "to appoint a receiver to determine if RWG holds any insurance policies or assets available to satisfy a damages award in the Massachusetts Action, find RWG's dissolution improper, and void RWG's certificate of cancellation."[1] Count I sought nullification on the ground that RWG failed to comply with Sections 18-203 and 18-804 of the LLC Act. Count II sought a receiver under Section 18-805.[1]
In an earlier post-trial ruling, the court found good cause to appoint a receiver "for the limited purpose of investigating whether the company had assets when it filed its notice of dissolution and cancellation," and deferred ruling on nullification until the receiver reported.[1] That earlier ruling applied a lower standard: whether it was "reasonably likely" the company still held undistributed assets.[1] The 2026 opinion decided nullification under the preponderance standard.[1]
How Did RWG Come to Be Dissolved?
The opinion traces RWG's history to a Wisconsin gasket manufacturer established in 1943 and incorporated in 1944.[1] Its assets were sold in 1981 to a Delaware subsidiary of a German company; that business later took the Reinz Wisconsin Gasket name and became part of Dana Corporation's group.[1] In March 2006, Dana Corporation and its subsidiaries, including RWG, filed for Chapter 11; the reorganization plan took effect on January 31, 2008.[1] In December 2016, Enstar Holdings (US) Inc., a subsidiary of Enstar Group Limited, acquired RWG's sole member, DCo, and with it RWG.[1]
According to the opinion, "Having failed to locate any other insurance policies, DCo determined dissolution was RWG's best course."[1] RWG filed its notice of dissolution and cancellation on August 30, 2022.[1] The court also found that RWG "had been inoperative for over a decade when it dissolved, and it had no assets."[1]
What Does Delaware Law Require of a Dissolving LLC?
Section 18-804(b) of the Delaware LLC Act requires a dissolved LLC to make provision for claims. Two parts mattered here. Section 18-804(b)(2) requires a dissolved company to make "such provision as will be reasonably likely to be sufficient to provide compensation for any claim against the limited liability company which is the subject of a pending action, suit or proceeding to which the limited liability company is a party."[2] Section 18-804(b)(3) requires similar provision for claims that, based on facts known to the company, are likely to arise or become known within 10 years after dissolution.[2]
Section 18-805 lets the Court of Chancery appoint a receiver for a cancelled LLC "on application of any creditor, member or manager of the limited liability company, or any other person who shows good cause therefor."[2] Section 18-203 governs the certificate of cancellation itself.[3]
The court grounded its power to nullify in Delaware case law: if an LLC is not wound up in accordance with the LLC Act, the court may nullify the certificate, which "effectively revives the LLC and allows claims to be brought by and against it."[1] Separately, Section 18-203(b) allows a certificate of cancellation filed before the completion of winding up to be "corrected or nullified as an erroneously executed certificate of cancellation" by filing a certificate of correction with the Secretary of State.[3]
How Did the Court Test Whether Contingent Rights Were Assets?
The court looked to the Delaware Supreme Court's decision in In re Krafft-Murphy Co. and stated its own reading of it: "I read Krafft-Murphy to offer two considerations in determining whether certain contingent rights, such as insurance policies and litigable claims, constitute assets within the meaning of Section 18-804."[1] First, the rights must be "capable of vesting." Second, they "should 'represent significant potential indemnification value' to the company."[1]
Applying that reading, the court concluded the petitioner had not shown RWG held any contingent insurance rights that were "capable of vesting" and worth "significant potential indemnification value" when it dissolved.[1]
Why Did the Insurance Policies Not Count as Assets?
The receiver's report identified thirty-three insurance policies.[1] The court addressed them in groups.
Two policies not shown to exist
For one Continental Casualty policy, "No one at Wisconsin Gasket DE or Continental could find this policy."[1] For one Travelers umbrella policy, the court wrote, "Petitioner has failed to prove this umbrella policy exists, let alone that it provides any coverage for RWG."[1] These are findings about the proof offered, not findings that the policies never existed.[1]
Policies issued before the 1981 asset sale
The court found it "undisputed RWG is not and has never been a named insured on any of the pre-Asset Sale policies."[1] The question was whether the policies had been transferred in the 1981 sale. The purchase agreement referred to an "Exhibit G" listing the seller's insurance, and "The Receiver has not located Exhibit G."[1] The missing exhibit did not decide the issue. The court said that even if it accepted the agreement's representations about Exhibit G, "Petitioner would still not meet her burden."[1] What was missing was proof of an actual transfer: "Petitioner has not identified any instruments transferring any policy."[1]
An insurer, Wausau, argued that anti-assignment clauses in its policies blocked any transfer. The court did not accept that argument: "I read Wisconsin precedent to provide that anti-assignment clauses in occurrence-based policies are unenforceable as applied to post-loss assignments."[1] The petitioner lost on these policies because she did not prove they were transferred, not because of the anti-assignment clauses.[1]
Policies issued after the asset sale
The post-sale workers' compensation policies did not help because "Petitioner's late husband was not employed by Wisconsin Gasket DE," and they did not cover the third-party asbestos claims pending against RWG.[1] The post-sale Travelers umbrella policies sat above primary coverage from an insurer that had entered liquidation in 2013.[1] The court held that "The umbrella does not drop down by virtue of the underlying insurer's 'bankruptcy or insolvency,'" and that the petitioner cited no evidence the underlying limits had been exhausted.[1]
Why Did the Litigable Claims Not Count as Assets?
The receiver also concluded RWG held litigable claims: insurance coverage claims, breach of fiduciary duty claims against its officers and directors, and aiding and abetting claims against DCo and an Enstar affiliate.[1] The court held these offered RWG no value.[1]
On the fiduciary claims, the court noted the petitioner "did not press these claims," and added: "In any case, no fiduciary duty is owed to claimants like Petitioner."[1] It also found any breach of duties owed to RWG and its sole member "largely exculpated" under RWG's operating agreement.[1] On aiding and abetting, the court reasoned that because RWG "had no assets," DCo's decision to dissolve it "did not cause it any harm," so that claim offered RWG no value either.[1]
What the Opinion Does Not Decide
- Asbestos trusts and Section 524(g). The opinion does not mention them.[1]
- Where the pre-1981 insurance rights reside. The court held only that the petitioner failed to prove they transferred to RWG's predecessor.[1]
- Whether the cancellation was lawful in the abstract. The holding is that the petitioner failed to prove the LLC Act was violated.[1]
- Later history. The opinion ends by directing the parties to "confer and submit a stipulated implementing order that addresses the Motion, the Receiver's future service, and Continental's counterclaim consistent with this opinion."[1] This page does not report any appeal.
Frequently Asked Questions
What did the court hold in In re Reinz Wisconsin Gasket?
The court denied the motion to nullify RWG's certificate of cancellation. It held that "Petitioner has failed to carry her burden to prove by a preponderance of the evidence that RWG had assets it failed to set aside for claimants when it dissolved."[1]
Was the decision only about insurance?
No. The court also held that the litigable claims the receiver identified, including coverage, fiduciary duty, and aiding and abetting claims, offered RWG no value.[1]
Did the missing Exhibit G decide the case?
No. The court said that even accepting the purchase agreement's representations about Exhibit G, "Petitioner would still not meet her burden," because she identified no instrument transferring any policy.[1]
Does the decision say anything about asbestos trust funds?
No. The opinion does not discuss asbestos bankruptcy trusts or Section 524(g).[1] For how those trusts work, see Asbestos_Trust_Funds and Section_524(g)_Bankruptcy_Trusts.
Which Delaware statutes were involved?
The petition invoked Sections 18-203 and 18-804 of the Delaware LLC Act, and sought a receiver under Section 18-805.[1][2]
Related Pages
- Suing_Foreign_or_Defunct_Asbestos_Companies
- Asbestos_Trust_Funds
- Section_524(g)_Bankruptcy_Trusts
- Insurance_Coverage_Overview
- Mesothelioma_in_Delaware
- Mesothelioma_Wrongful_Death_Claims
External Links
References
- ↑ 1.00 1.01 1.02 1.03 1.04 1.05 1.06 1.07 1.08 1.09 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22 1.23 1.24 1.25 1.26 1.27 1.28 1.29 1.30 1.31 1.32 1.33 1.34 1.35 1.36 1.37 1.38 1.39 1.40 1.41 1.42 1.43 1.44 1.45 1.46 1.47 1.48 1.49 1.50 1.51 1.52 1.53 1.54 1.55 1.56 1.57 1.58 1.59 1.60 1.61 1.62 1.63 1.64 1.65 1.66 1.67 1.68 1.69 1.70 1.71 1.72 1.73 1.74 1.75 1.76 1.77 1.78 1.79 Memorandum Opinion, In re Reinz Wisconsin Gasket, LLC, C.A. No. 2022-0859-MTZ (Del. Ch. Apr. 2, 2026). Court of Chancery of the State of Delaware.
- ↑ 2.0 2.1 2.2 2.3 Delaware Code, Title 6, Chapter 18, Subchapter VIII: Dissolution (§§ 18-801 to 18-806). State of Delaware.
- ↑ 3.0 3.1 Delaware Code, Title 6, Chapter 18, Subchapter II: Formation; Certificate of Formation. State of Delaware.