News & Analysis as of

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

Is there a Serious Threat to a Secured Creditor's Right to Credit Bid at Bankruptcy Sales, or Is the Impact of Recent Cases...

The right to credit bid is one of the most important protections afforded a secured creditor. Recognized under both state and bankruptcy law, the right to credit bid safeguards against undervaluation at an asset sale, whether...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

Commercial Restructuring & Bankruptcy Newsletter - June 2014

In this issue: - Are Breakup Fees at Risk? - Credit Bidding Rights Limited, Capped by Debt Purchase Amount - Court Upholds Creditor’s Security Interest Despite Post-Petition Lapse of Financing Statement...more

Delaware District Court Affirms Order Approving Gifting In Chapter 11 Case

The U.S. District Court for the District of Delaware has affirmed a bankruptcy court order which approved both a sale of the debtors’ assets and the establishment of an escrow account, which essentially provides a “gift” to...more

Court Rejects Effort to Transfer Venue of Energy Future Holdings Bankruptcy From Delaware to Texas

In a ruling yesterday, Judge Christopher Sontchi of the United State Bankruptcy Court for the District of Delaware denied a motion by a bond trustee to transfer venue of the Dallas-based Energy Future Holdings from...more

Sbarro LLC Confirms Plan of Reorganization

On Monday, May 29, 2014, the United States Bankruptcy Court for the Southern District of New York approved Sbarro LLC’s plan of reorganization, paving the way for the pizza restaurant chain to exit bankruptcy. Sbarro filed...more

Recent Decision Caps Secured Creditor’s Credit Bid in §363 Sale to Purchase Price of Acquired Debt

It is well-settled that secured creditors are ordinarily entitled to credit bid their allowed secured claim in a sale pursuant to § 363 of the Bankruptcy Code (the “Code”). In Radlax Gateway Hotel, LLC v. Amalgamated Bank,...more

Capital Infusion: Case Spotlight: In re SemCrude, L.P.

Sudden interruptions in oil supplies caused by the 1973 Arab oil embargo, the Iranian revolution of 1979 and the outbreak of the war between Iran and Iraq in 1980 led to the energy crises of the 1970’s and 1980’s, forcing...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

The $382,901 Check Really is in the Mail

We recently delivered a $382,901 check to a client in payment of a Bankruptcy Section 503(b)(9) claim, known as a “20-day administrative” claim. The claim arose from the client’s pre-petition sale of goods to its customer....more

Wilbur Ross Says Results-Based System Can Curb Ch. 11 Fees

Law360, New York (December 03, 2012, 7:05 PM ET) -- An American Bankruptcy Institute commission designed to take stock of the state of Chapter 11 anticipates that any changes to the Bankruptcy Code would likely focus on the...more

Commercial Restructuring & Bankruptcy Alert - February 2013

In this Issue: - Lenders Beware - International Insolvency Laws: Will One Size Fit All? The Debate Continues - ‘Fair and Equitable’ Means More Than Amortization Schedule - Pre-Petition Security License...more

Transformation of Tort Claim into Different Type of Collateral Did Not Give Secured Creditor a Lien

An October 2011 decision from the United States District Court for the Northern District of New York highlights the importance of correctly taking all of the steps necessary to obtain a security interest in commercial tort...more

SCOTUS' RadLAX Decision Affirms Lenders' Rights to Credit Bid in Chapter 11

May a Chapter 11 plan permit a debtor to auction property free and clear of a creditor’s lien while preventing that creditor from credit-bidding the amount of its debt? A question that split the U.S. Circuit Courts was...more

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