Cramdown

News & Analysis as of

Plan Confirmation Feasibility: “I Know It When I See It”?

In re Brandywine Towhouses, Inc., 524 B.R. 889 (Bankr. N.D. Ga. 2014) – The debtor was a nonprofit that owned a low and moderate income housing cooperative. It proposed a plan of reorganization that contemplated...more

Commercial Restructuring & Bankruptcy Alert - February 2015

In This Issue: - Minority Holders Gain Leverage Through Recent Interpretation of Trust Indenture Act - New Jersey Joins Number of States Creating Specialty Business Courts - Credit Bid Rights Bolstered in...more

Overview and Analysis of Select Provisions of the ABI Chapter 11 Reform Commission Final Report and Recommendations

In December, the American Bankruptcy Institute issued its Final Report and Recommendations of the Commission to Study the Reform of Chapter 11. The Report is almost 400 pages long and contains more than 200 recommendations....more

"Significant Ruling Gives Chapter 11 Debtors New Leverage Over Secured Creditors"

The Bankruptcy Code's so-called "cramdown" statute provides debtors with a significant tool that can be used to impose a reorganization plan upon recalcitrant secured lenders, subject to fulfillment of certain requirements....more

Cramdown Hurdles: How to Play the Classification Game (Or Not)

In re New Bride Missionary Baptist Church, 509 B.R. 85 (Bankr. E.D. Mich. 2014) – After the bankruptcy court denied confirmation of a debtor’s proposed chapter 11 plan of reorganization because there was no accepting...more

Bankruptcy Beat: Connecticut Bankruptcy Court Rules on Issue of First Impression: Whether The Absolute Priority Rule Is Applicable...

Chief United States Bankruptcy Court Judge Julie A. Manning decided an issue of first impression in this District and the Second Circuit on September 4, 2014 in In re Richard and Stephanie Lucarelli and Lucarelli’s Executive...more

No Market Interest Rate and No Make Whole: Momentive Performance Court Rejects Lender Arguments Against Confirmation

On August 26, 2014, Judge Robert D. Drain of the United States Bankruptcy Court for the Southern District of New York ruled that (i) the debtors could satisfy the cramdown requirements of section 1129(b) of the Bankruptcy...more

Bankruptcy Court Holds That Secured Creditors Can Be “Crammed Down” With Below-Market Rate Replacement Notes

On August 26, 2014, in the case In re MPM Silicones, LLC, Case No. 14-22503 (Bankr. S.D.N.Y.) (“Momentive”), the United States Bankruptcy Court for the Southern District of New York held that secured creditors could be...more

Chapter 20 in the Eleventh Circuit: Modification of Secured Claims Impermissible Without Discharge

Nearly a year ago to the day, we published a post regarding the uncertainty that bankruptcy practitioners and lenders faced when a Chapter 7 debtor received a discharge, and subsequently filed a Chapter 13 petition to strip...more

Two Recent Circuit Court Decisions on Cram Down

Two recent decisions by United States Circuit Courts of Appeal separately address the rights of secured creditors, unsecured creditors and equity holders under cram down plans of reorganization. In Wells Fargo Bank National...more

Burr Alert: The Basics Of Cramdown Interest Rates In Chapter 11

A debtor in a chapter 11 bankruptcy may treat a secured claim in one of two ways in its plan of reorganization: (1) the debtor may propose to cure any existing default, compensate the creditor for any loss sustained by the...more

Lenders Beware -- Fifth Circuit has lowered the bar for cramdown plan confirmation

In a recent Fifth Circuit decision, Western Real Estate Equities, LLC v. Village at Camp Bowie I, L.P., No. 12-10271 (5th Cir. 2013), the court held that the acceptance vote from a minimally and “artificially impaired” class...more

Fifth Circuit Decisions Concerning Confirmation Of Plans Of Reorganization

The U.S. Court of Appeals for the Fifth Circuit recently issued two decisions that affect a borrower’s ability to confirm a bankruptcy plan, Western Real Estate Equities, L.L.C. v. Village at Camp Bowie I, L.P. (In re Village...more

When “Loan to Own” Becomes “Own a Loan” – How a Recent Fifth Circuit Decision Rejecting the Artificial Impairment Doctrine...

Chapter 11 of the U.S. Bankruptcy Code provides debtors with a number of tools to restructure comprehensively their debts and other liabilities as well as immediate protection from secured and unsecured creditors. In single...more

Bill on Bankruptcy: Secret Madoff Agreement May Harm Victims  [Video]

Feb. 27 (Bloomberg) -- Money stolen from victims of the Bernie Madoff Ponzi scheme is earmarked for someone who may have been an accomplice in the fraud, and the agreement is being kept secret by a federal district judge. ...more

Formal Objection to Confirmation not Necessary to Appeal “Absolute Priority” Violation

Cramdown. The very word makes the hair on the back of lenders’ necks stand up, because in the past, there was little a lender could do once the bankruptcy court confirmed a Chapter 11 plan....more

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