News & Analysis as of

Secured Debt Chapter 11

Litigation Funders’ Collateral Did Not Include Malpractice Claims

When the fallout from failed intellectual-property litigation collides with bankruptcy, the complexities may be dizzying enough, but when the emerging practices and imperatives of litigation financing are imposed on those...more

Secured Lenders Take Note! In re Sunnyslope is something you want to know about

by Tucker Arensberg, P.C. on

In re Sunnyslope Hous. Ltd. P’ship, 859 F.3d 637 (9th Cir. 2017), as amended (June 23, 2017)(“Sunnyslope”), is a noteworthy case for secured lenders. The case involves confirmation of the cram down plan proposed by Sunnyslope...more

Second Circuit: Market Rate Preferred Over Formula Rate For Purposes of Secured Creditor Cramdown in Chapter 11 Issues

by Bryan Cave on

Courts and professionals have wrestled for years with the appropriate approach to use in setting the interest rate when a debtor imposes a chapter 11 plan on a secured creditor and pays the creditor the value of its...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

Cramdown Interest Rate Best Set Based on Market Rates

by Robinson & Cole LLP on

The Bankruptcy Code permits cramdown of a secured creditor but requires that the secured creditor receive deferred cash payments at least equal to the value of its collateral. This means that installment payments to the...more

Ninth Circuit Reverses Course on Measure of Collateral Value in Cramdown Confirmation of Chapter 11 Plan

by Jones Day on

In First Southern Nat’l Bank v. Sunnyslope Hous. LP (In re Sunnyslope Hous. LP), 2017 BL 216965 (9th Cir. June 23, 2017), the U.S. Court of Appeals for the Ninth Circuit held en banc that, in determining whether a chapter 11...more

Supreme Court Declines to Resolve Circuit Split on Debt Recharacterization

On August 10, 2017, the U.S. Supreme Court rescinded the grant of certiorari in PEM Entities LLC v. Levin on the grounds that review had been “improvidently granted.” The case seemingly provided a perfect vehicle to resolve...more

Ninth Circuit Rules That Hypothetical Preference Actions May Be Considered in Applying the Greater Amount Test

by Jones Day on

In Schoenmann v. Bank of the West (In re Tenderloin Health), 849 F.3d 1231 (9th Cir. 2017), a divided panel of the U.S. Court of Appeals for the Ninth Circuit recently addressed as a matter of apparent first impression...more

Reaping Wild Oats – Creative Strategies Employing the Concepts of Chapter 12 of the Bankruptcy Code for Handling Distressed...

by Ervin Cohen & Jessup LLP on

Handling distressed agricultural loans can be very tricky. Loan balances for agricultural loans are typically smaller than nonagricultural commercial real property secured loans, requiring that they be handled extremely cost...more

Unauthorized Transfers of Receivership Property: Void, Voidable or Ok?

by Ervin Cohen & Jessup LLP on

Question: Unauthorized Transfers of Receivership Property: Void, Voidable or Ok? Answer: In a recent unpublished bankruptcy appellate panel decision (In Re Domum Locis, LLC, 2015 WL 4697747 (9th Cir. BAP 2015)), the BAP...more

Blog: Illinois Bankruptcy Court Articulates Low Threshold for Equitable Subordination of Insider Secured Loan

by Cooley LLP on

For a distressed company running low on capital, an investment from insiders may represent a last best hope for survival. Insiders may be willing to risk throwing good money after bad for a chance to save the company even...more

Co-debtors’ Obligations May be Treated Differently in Bankruptcy

Imagine the following common scenario: A lender makes a commercial loan and the note is signed by two borrower entities, each of whom provides separate real property collateral as security for the loan. The borrowers...more

Buyer (and its Creditors) Beware: SemCrude District Court Finds That Purchasers Took Oil and Gas Free and Clear of Producers'...

Although almost eight years have lapsed since the chapter 11 cases of Tulsa, Oklahoma-based SemCrude L.P. were confirmed, many of the issues at the forefront of those cases are re-emerging in light of the recent uptick in oil...more

Equitable Liens: No Mortgage Does Not Necessarily Mean No Lien

by Pepper Hamilton LLP on

Marcum v. Marcum (In re Marcum), 508 B.R. 499 (Bankr. M.D. Fla. 2014) – A creditor made two prepetition loans to a chapter 13 debtor for payment of delinquent real estate taxes. The loans were supposed to be secured by...more

Spotlight on Brazil: Recuperação Judicial vs. Chapter 11

by Morrison & Foerster LLP on

The bankruptcy proceedings of Brazilian oil companies OGX and OSX have all the makings of a financial soap opera: one high-profile billionaire filing for bankruptcy on behalf of two related enterprises with a combined...more

Signal International, Inc. and Affiliates File Chapter 11; CFO Says Filing And Quick Sale Will Resolve 7 Years of Litigation And...

by Morris James LLP on

On July 12, 2015, Gulf Coast marine service operator Signal International, Inc. and four affiliates, including Signal Ship Repair, LLC, Signal International, LLC, Signal International Texas GP, LLC and Signal International...more

The Supreme Court Holds That a Bankruptcy Court’s Order Denying Confirmation of a Debtor’s Proposed Chapter 13 Plan Is Not a...

by Shearman & Sterling LLP on

In a May 4, 2015 opinion1, the United States Supreme Court held that a bankruptcy court order denying confirmation of a chapter 13 repayment plan is not a final order subject to immediate appeal. The Supreme Court found that,...more

Supreme Court Reaffirms a Chapter 7 Debtor's Inability to Strip a Lien Against Real Property

by Allen Matkins on

Reaffirming its 1992 decision in Dewsnup v. Timm, on June 1, 2015, the U.S. Supreme Court in Bank of America v. Caulkett, No. 13-1421, once again ruled that a chapter 7 debtor may not void a junior lien under Bankruptcy Code...more

Bankruptcy & Restructuring Litigation Update - May 2015

New Bankruptcy Challenges for Secured Creditors. The Bankruptcy Code provides secured creditors with significant advantages over their unsecured counterparts. During the past year, however, courts have chipped away at secured...more

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

by Cooley LLP on

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

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

by Blank Rome LLP on

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

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