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Bankruptcy Civil Procedure

Read Bankruptcy Law updates, alerts, news, and legal analysis from leading lawyers and law firms:

(Make) Wholly Moly: U.S. Court of Appeals for the Second Circuit Upholds Ruling Denying Noteholders’ Entitlement to a Make-Whole...

by Shearman & Sterling LLP on

On October 20, 2017, the United States Court of Appeals for the Second Circuit issued a decision which, among other things, affirmed the lower courts’ holding that certain noteholders were not entitled to payment of a...more

Amending Complaints 101 By Judge Gross – Physiotherapy Holdings

by Fox Rothschild LLP on

In a 10-page decision signed November 6, 2017 in an adversary proceeding arising within the Physiotherapy Holdings bankruptcy (PAH Litigation Trust, case 15-51238), Judge Gross of the Delaware Bankruptcy Court denied a motion...more

The Cookie Crumbles in Baker’s Bid for a § 503(b)(9) Administrative Claim

Under section 503(b)(9) of the Bankruptcy Code, a creditor may recover as a priority administrative expense the value of goods sold to the debtor in the ordinary course of its business that are “received” by the debtor within...more

2nd Circuit: Secured Lenders Entitled to Market-Rate Interest in Cram-Down Plan

by McGuireWoods LLP on

In October 2017, the 2nd U.S. Circuit Court of Appeals, in In re MPM Silicones (Momentive) LLC, held that a non-consenting class of creditors is entitled to receive post-confirmation interest at a market rate if an efficient...more

Liquidation Trustee’s Suit Against D&Os Falls Within Insured vs. Insured Exclusion

by Fox Rothschild LLP on

In the recent decision of Indian Harbor Ins. Co. v. Zucker, 860 F.3d 373 (6th Cir. 2017), the Sixth Circuit Court of Appeals held that a liquidation trustee’s suit against the debtor’s former directors and officers (D&Os)...more

Third Circuit Reinforces that Rules are Not Meant to Be Broken

The Third Circuit recently held, in Schepis v. Burtch (In re Pursuit Capital Management, LLC), No. 16-3953, 2017 WL 4783009 (3d Cir. Oct. 24, 2017), that under section 363(m) of the Bankruptcy Code, if a party does not seek a...more

Judge Silverstein’s Opinion in Millennium Lab Holdings Threatens to Bring Clarity and Common Sense to Debate Regarding...

by Kelley Drye & Warren LLP on

In December 2015, U.S. Bankruptcy Court Judge Laurie Silverstein of the District of Delaware confirmed a plan of reorganization in the Millennium Lab Holdings chapter 11 case that included the non-consensual release of...more

A Degree Too Far: NY Bankruptcy Court Denies Debtors’ Request For Bankruptcy Rule 2004 Examination In Connection With Third-Party...

by Cole Schotz on

History: In a June 14, 2017, bankruptcy blog titled “Six Degrees of Separation: Use of Bankruptcy Rule 2004 Examination in Connection with Third-Party Litigation“, we reported on what appeared to be a case of first...more

Fee Disgorgement Can Be The Least Of Your Problems

by Fox Rothschild LLP on

In a decision signed October 25, 2017, Judge Shannon of the Delaware Bankruptcy Court issued an opinion requiring a professional to disgorge fees, pay a sanction of $25,000, and enjoined him from taking various actions in...more

We, the Releasees: Delaware Bankruptcy Court Holds That It Had Constitutional Authority to Approve Nonconsensual Third-Party...

by Shearman & Sterling LLP on

On October 3, 2017, Bankruptcy Judge Laurie Selber Silverstein of the United States Bankruptcy Court for the District of Delaware issued a decision holding that the Bankruptcy Court had constitutional authority to approve...more

Bankruptcy Trustees Are Entitled To Jury Trials Too?!

by Fox Rothschild LLP on

Americans generally cherish their right to a jury trial under the Sixth and Seventh Amendments to the United States Constitution and the media certainly perpetuate the idea that jury trials are the norm. However, there are...more

Momentive: Key Second Circuit Decision Tackles Make-Whole Premiums and Cramdown Interest

by Blank Rome LLP on

Action Item: Lenders and bankruptcy practitioners will need to consider with care how the Second Circuit’s recent Momentive decision will impact negotiations of (i) contractual provisions relating to payment of make-whole...more

Second Circuit: Secured Lender Not Entitled to a Make Whole Premium in “Cramdown” Restructuring, But May Be Entitled to Higher...

by BakerHostetler on

On October 20, in Matter of M.P.M. Silicones, L.L.C. (“M.P.M. Silicones”), the United States Court of Appeals for the Second Circuit held that secured noteholders were not entitled to an approximately $200 million make-whole...more

A Momentive Decision: Second Circuit Splits with Third Circuit on Make Whole Premiums; Adopts Sixth Circuit’s Two-Step Approach in...

Last week the Second Circuit issued its long-awaited opinion on the appeals of plan confirmation taken by the first lien, 1.5 lien and subordinated noteholders in In re MPM Silicones, LLC (“Momentive”). With one exception,...more

Second Circuit Rules on Chapter 11 Cram-Down, Make-Whole, and Subordination Issues

by Jones Day on

The Situation: In In re MPM Silicones, L.L.C., secured noteholders argued that replacement notes distributed to them under a cram-down chapter 11 plan should bear market-rate interest rather than the lower formula rate...more

Second Circuit Gives Momentive Secured Creditors Another Shot at Market-Based Interest Rate in Cramdown Fight; Also Affirms...

by King & Spalding on

On October 20, 2017, the U.S. Court of Appeals for the Second Circuit delivered a victory for secured lenders by remanding the District Court’s order confirming the Debtors’ proposed plan to determine whether an efficient...more

Eleventh Circuit Narrows Application of Judicial Estoppel

by Burr & Forman on

The Eleventh Circuit has revisited the question of when a debtor may be judicially estopped from pursuing a civil lawsuit due to his or her failure to disclose the claims forming the basis of the lawsuit in their bankruptcy....more

Millennium Lab Part II: Delaware Bankruptcy Court Dispels Shadow Over Non-Consensual Third-Party Releases (For Now)

by Dechert LLP on

In trotting a path out of Chapter 11, debtors in most cases will need to engage various key stakeholders, some of whom are not entitled to a distribution in the bankruptcy. As a form of remuneration, non-debtors may insist on...more

SDNY Ruling Restricts Involuntary Bankruptcy Filings Against Chapter 15 Debtors

by Latham & Watkins LLP on

Cross-border debtors gain another tool to use against dissident creditors seeking to disrupt foreign restructuring proceedings. Introduction - In In re Ocean Rig UDW Inc., et al., Case No. 17-10736, a creditor...more

Second Circuit Rejects Categorical Dismissal Of Market Rates When Determining Cram-Down Interest Rates In Chapter 11

On October 20, 2017, the Second Circuit issued its long awaited ruling on several appeals from a U.S. District Court (Bricetti, J.) determination affirming the United States Bankruptcy Court (Drain, J.) in the MPM Silicones,...more

Assigning liquidator rights to sue: what has been created?

by DLA Piper on

Following a suite of recent reforms to Australian insolvency laws, liquidators are now able to assign rights to sue, conferred on them personally by the Corporations Act. The new power to assign is broad. It appears that the...more

Restructuring and Insolvency Bulletin Issue 2 - 2017: An update on COMI shifting to take advantage of the best insolvency tools to...

by Dechert LLP on

The EU has taken aim at fraudulent or abusive forum shopping in the Recast Insolvency Regulation, acknowledging the potential for misuse by debtors seeking to take advantage of more flexible insolvency processes available in...more

Real Property, Financial Services, & Title Insurance Update: Weeks Ending October 6 & 13, 2017

by Carlton Fields on

REAL PROPERTY UPDATE FINANCIAL SERVICES UPDATE - Ad Valorem Taxes: land lease holders are considered equitable owners of land for tax purposes if land lease renews automatically and is perpetual; owners of condominium...more

No Notice: How Unnotified Creditors Can Violate a Discharge Injunction

by Bryan Cave on

Here is the scenario: You are a creditor. You hold clear evidence of a debt that is not disputed by the borrower, an individual. That evidence of debt could be in the form of a note, credit agreement or simply an invoice. ...more

Restructuring and Insolvency Bulletin Issue 2 - 2017: Offshore and off limits: SDNY Bankruptcy Court finds foreign transfer...

by Dechert LLP on

Can foreign transfers of a U.S. debtor be avoided under the Bankruptcy Code’s avoidance provisions? While the Bankruptcy Court for the Southern District of New York recently found that the answer is no, that court, as well as...more

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