Plaintiffs in business disputes often attempt to make a case for the imminent danger of irreparable harm (a required element for ordering expedited proceedings and for many types of equitable relief, such as entitlement to a temporary restraining order (TRO) or preliminary injunction).  Courts have developed numerous guidelines to determine whether a prima facie case for imminent danger of irreparable harm has been made.  Perhaps one of the most common bases for claiming imminent danger is a claim that the defendant is fiscally insolvent and will be unable to pay its debts or otherwise satisfy the terms of a judgment, in the event the plaintiff prevails.
The Delaware Court of Chancery recently addressed this issue in Platinum Partners Value Arbitrage Fund L.P. v. Echo Therapeutics, Inc.[1] In Platinum Partners, the plaintiff sought expedited proceedings on the grounds that the defendant was facing insolvency.[2]  The Court acknowledged that insolvency may be sufficient to establish  a case for imminent danger, but made the following observations about the nature of the claims asserted:

[I]t may often be the case that a plaintiff can allege that a company’s weak financial position and poor management pose the danger that delay will impair plaintiff’s ability to obtain effective ultimate relief. Echo has suspended product research, has experienced manufacturing and clinical problems, and has terminated most of its employees. Platinum, however, has not identified the irreparable harm which could be avoided through expedition. It does not allege that it would be likely that a new board could obtain a reversal of fortune or suggest how a new board would be able to stem the downward decline. The fact that one stockholder plaintiff, such as Platinum, believes expedition is necessary does not establish an imminent and non-speculative irreparable harm.[3]

Although the Court denied the Motion to Expedite, it did note that the case could proceed on a fairly short schedule:

Although expedition has not been justified, Echo is under financial duress, and its stockholders may have good reason to replace the Defendant Directors. The issues raised by Platinum can, at least from a preliminary review, be resolved both timely and in a relatively straightforward manner. Thus, counsel are asked to discuss and develop a case management schedule that would have this action ready for decision in approximately ninety days.[4]