Section 546(e) of the Bankruptcy Code’s “safe harbor” preventing avoidance in bankruptcy of certain securities, commodity, or forward-contract payments has long been a magnet for controversy. Several noteworthy court rulings...more
10/3/2023
/ Article III ,
Bankruptcy Code ,
Chapter 11 ,
Chapter 7 ,
Commercial Bankruptcy ,
Corporate Restructuring ,
Fraudulent Transfers ,
Safe Harbors ,
Securities Contracts ,
Sovereign Immunity ,
Standing
Bankruptcy trustees and chapter 11 debtors-in-possession ("DIPs") frequently seek to avoid fraudulent transfers and obligations under section 544(b) of the Bankruptcy Code and state fraudulent transfer or other applicable...more
10/3/2023
/ Abrogation ,
Bankruptcy Code ,
Bankruptcy Court ,
Bankruptcy Trustees ,
Chapter 11 ,
Debtors-in-Possession ,
Fraudulent Transfers ,
Government Entities ,
Internal Revenue Code (IRC) ,
IRS ,
Sovereign Immunity
On June 6, 2023, the U.S. Bankruptcy Court for the Southern District of Texas confirmed the chapter 11 plan of bedding manufacturer Serta Simmons Bedding, LLC and its affiliates (collectively, "Serta"). In confirming Serta's...more
There is longstanding controversy concerning the validity of third-party release provisions in non-asbestos trust chapter 11 plans that limit the potential exposure of various nondebtor parties involved in the process of...more
7/28/2023
/ Bankruptcy Code ,
Bankruptcy Court ,
Bankruptcy Preferences ,
Chapter 11 ,
Chapter 13 ,
Chapter 15 ,
Chapter 7 ,
Commercial Bankruptcy ,
Consumer Bankruptcy ,
Creditors ,
Debtors ,
Restructuring ,
SCOTUS
Since May 2023, the U.S. Supreme Court has issued three decisions addressing or potentially impacting issues of bankruptcy law. These included rulings concerning the abrogation of sovereign immunity for Native American tribes...more
7/28/2023
/ Bankruptcy Code ,
Bankruptcy Court ,
Chapter 11 ,
Fin Oversight & Mgmt Bd for Puerto Rico v Centro de Periodismo Investigativo Inc ,
Financial Services Industry ,
Lac du Flambeau Band of Lake Superior Chippewa Indians v Coughlin ,
Native American Issues ,
Puerto Rico Oversight Management and Economic Stability Act (PROMESA) ,
SCOTUS ,
Sovereign Immunity ,
Takings Clause ,
Tribal Corporations ,
Tribal Loans ,
Tyler v Hennepin County Minnesota
In Czyzewski v. Jevic Holding Corp., 137 S. Ct. 973 (2017), the U.S. Supreme Court held that the Bankruptcy Code does not allow bankruptcy courts to approve distributions to creditors in a "structured dismissal" of a chapter...more
There is longstanding controversy concerning the validity of third-party release provisions in non-asbestos trust chapter 11 plans that limit the potential exposure of various non-debtor parties involved in the process of...more
A bankruptcy trustee's ability to avoid and recover pre-bankruptcy preferential transfers is essential to preserving or augmenting the estate for the benefit of all stakeholders. In 2019, however, the Bankruptcy Code was...more
7/28/2023
/ Affirmative Defenses ,
Avoidance ,
Bankruptcy Code ,
Bankruptcy Court ,
Bankruptcy Trustees ,
Chapter 11 ,
Chapter 7 ,
Commercial Bankruptcy ,
Debtors-in-Possession ,
Delaware ,
Due Diligence ,
Preferential Transfers
To prevent "trafficking in corporate shells," the Bankruptcy Code prohibits any discharge of corporate or partnership debts if the debtor is not an "individual" and, in a chapter 11 case, if the debtor proposes a liquidating...more
Section 363(m) of the Bankruptcy Code provides that the reversal or modification of an order approving a sale or lease of assets in bankruptcy does not affect the validity of the sale or lease to a good-faith purchaser or...more
Exculpation clauses limiting the liability of certain entities for actions taken in connection with a bankruptcy case are a common feature of chapter 11 plans. However, courts disagree over the permitted scope of such...more
To prevent landlords under long-term real property leases from reaping a windfall for future rent claims at the expense of other creditors, the Bankruptcy Code caps the amount of a landlord's claim against a debtor-tenant for...more
Section 363(m) of the Bankruptcy Code provides that the reversal or modification of an order approving a sale or lease of assets in bankruptcy does not affect the validity of the sale or lease to a good-faith purchaser or...more
6/19/2023
/ 363 Sales ,
Bankruptcy Code ,
Bankruptcy Court ,
Chapter 11 ,
Commercial Bankruptcy ,
Jurisdiction ,
MOAC Mall Holdings LLC v Transform Holdco LLC ,
Mootness ,
Sale of Assets ,
SCOTUS ,
Sears ,
Section 363 ,
Stays
Chapter 15 Recognition Limited to Foreign Insolvency, Liquidation, or Restructuring Proceedings -
In In re Global Cord Blood Corp., 2022 WL 17478530 (Bankr. S.D.N.Y. Dec. 5, 2022), the U.S. Bankruptcy Court for the...more
A chapter 11 plan may be modified after votes have been solicited on the plan, but prior to confirmation, without providing creditors and interest holders with an amended disclosure statement and another opportunity to vote...more
A handful of recent high-profile court rulings have considered whether a chapter 11 debtor is obligated to pay postpetition, pre-effective date interest ("pendency interest") to unsecured creditors to render their claims...more
Lawyer Spotlights: Genna Ghaul and Nicholas J. Morin -
The Year in Bankruptcy: 2022 -
A brief chronicle of the year's notable developments in corporate bankruptcy and restructuring, including business bankruptcy...more
One year ago, we wrote that, in early 2021, it was widely anticipated that the unprecedented pressure the COVID-19 pandemic brought to bear on the U.S. economy would lead to a boom in corporate bankruptcy filings. That boom...more
To promote the finality of bankruptcy asset sales, section 363(m) of the Bankruptcy Code "moots" an appeal of an order approving a sale to a good-faith purchaser unless the party challenging the sale obtains a stay pending...more
The Bankruptcy Code confers "administrative expense" priority status on the claims of vendors for the value of goods that are shipped in the ordinary course of business and received by a debtor within 20 days of filing for...more
The ability of a bankruptcy trustee or chapter 11 debtor-in-possession ("DIP") to assume, assume and assign, or reject executory contracts and unexpired leases is an important tool designed to promote a "fresh start" for...more
The ability of a bankruptcy trustee or chapter 11 debtor-in-possession ("DIP") to assume, assume and assign, or reject executory contracts and unexpired leases is an important tool designed to promote a "fresh start" for...more
Valuation is a critical and indispensable part of the bankruptcy process. How collateral and other estate assets (and even creditor claims) are valued determines a wide range of issues, from a secured creditor's right to...more
When lenders use an aggressive strategy to deal with a financially troubled borrower that ultimately files for bankruptcy protection, stakeholders in the case, including chapter 11 debtors, trustees, committees, and even...more
In Gulfport Energy Corp. v. FERC, 41 F.4th 667 (5th Cir. 2022), the U.S. Court of Appeals for the Fifth Circuit tripled down on its nearly two-decades-long view that filed-rate contracts regulated under the National Gas Act...more