News & Analysis as of

Trustees Commercial Bankruptcy

Delaware Court Rules Fraudulent Transfer Recoveries Are Not Capped At The Amount of Creditor Claims

by Robins Kaplan LLP on

One of the most powerful remedies available to a judgment creditor or a bankruptcy trustee is the power to avoid and recover fraudulent transfers. Very generally, fraudulent transfers are transfers made by a debtor (1) with...more

Second Circuit Issues Key Cramdown Interest Rate Ruling

by Jones Day on

In Momentive Performance Materials Inc. v. BOKF, NA (In re MPM Silicones, L.L.C.), 2017 BL 376794 (2d Cir. Oct. 27, 2017) ("Momentive"), the U.S. Court of Appeals for the Second Circuit, in a long-anticipated decision,...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

Eroding the Majority Rule: Another Circuit Concludes That Lease Can Be Extinguished in Free-and-Clear Bankruptcy Sale

by Jones Day on

The ability of a trustee or chapter 11 debtor-in-possession ("DIP") to sell bankruptcy estate assets "free and clear" of competing interests in the property has long been recognized as one of the most important advantages of...more

Focus on Health Care Provider Bankruptcies

by Jones Day on

The next few years are expected to see a significant increase in the volume of bankruptcy cases filed by health care providers. Thus far in 2017, the number of bankruptcies in health care-related sectors, including hospitals,...more

Yet Another Ruling Deepens the Divide on Whether the Bankruptcy Code’s Avoidance Provisions Apply Extraterritorially

by Jones Day on

The ability to avoid fraudulent or preferential transfers is a fundamental part of U.S. bankruptcy law. However, when a transfer by a U.S. entity takes place outside the U.S. to a non-U.S. transferee—as is increasingly common...more

Samson Resources Preference Actions Filed In Delaware

by Fox Rothschild LLP on

Starting on September 12, 2017, Peter Kravitz, as Settlement Trustee of the Samson Settlement Trust, filed approximately 293 complaints seeking the avoidance and recovery of allegedly preferential and/or fraudulent transfers...more

Courts, Cooperation, and More: Incorporating Case-Specific Provisions in Insolvency Protocols - September 2017

by Jones Day on

In cross-border restructuring cases, interested parties increasingly rely on court-approved insolvency protocols to aid in managing complex insolvencies involving debtors' assets, liabilities, or operations that span...more

Delaware Bankruptcy Court Dismisses Claims Against Echo/RT Holdings In Raytrans Bankruptcy Case

by Fox Rothschild LLP on

In the recent decision of Klauder v. Echo/RT Holdings LLC (In re Raytrans Holding, Inc.), Adv. No. 15-50273 (CSS) (Del. Bankr. Aug. 10, 2017), Judge Sontchi granted Defendants’ Motion to Dismiss the Trustee’s Second Amended...more

Two Recent Decisions Demonstrate Continued Disagreement Over Whether Economic Value or Face Amount of Liens Is Appropriate Metric...

by Jones Day on

The ability of a trustee or chapter 11 debtor in possession ("DIP") to sell bankruptcy estate assets "free and clear" of liens on the property under section 363(f) of the Bankruptcy Code has long been recognized as one of the...more

Preferences Actions Filed In Univita Holdings LLC Bankruptcy Case

by Fox Rothschild LLP on

On July 19-21, 2017, David W. Carickhoff, in his capacity as Chapter 7 Trustee of the Estates of Univita Holdings, et al., filed approximately 46 complaints seeking the avoidance and recovery of allegedly preferential and/or...more

In Brief: Court Rules Against Lyondell Litigation Trustee on LBO Fraudulent Conveyance Claims

by Jones Day on

In Weisfelner v. Blavatnik (In re Lyondell Chemical Company), 2017 BL 131876 (Bankr. S.D.N.Y. Apr. 21, 2017), the bankruptcy court presiding over the chapter 11 case of Lyondell Chemical Company ("Lyondell") handed down a...more

Substantive Consolidation of Non-Debtors-Standing and Notice Issues

by Dechert LLP on

U.S. courts generally agree that the substantive consolidation should be applied sparingly, and even more so when substantive consolidation of debtors with non-debtors is sought. While many opinions address the grounds for...more

Section 1111(b) Election Not Available When Collateral Is Sold Post Petition

by Dechert LLP on

The facts in Salamon are straightforward. Salamon (“Buyer”) purchased real property from Behrend (“Seller”) that was already subject to two liens (the “Preexisting Debt”). Instead of paying cash at closing, the Buyer executed...more

Sometimes It Takes 2.5 Years To Reach Summary Judgment

by Fox Rothschild LLP on

On September 3, 2014, Brent Williams, the Plan Trustee (“Trustee”) for Touch America Holdings, Inc., filed a complaint initiating an adversary proceeding against, among others, AT&T Corp. (AT&T”). In a 36 page decision dated...more

Walrath Opinion on Avoidance Actions – Motion for Summary Judgment: Denied

by Fox Rothschild LLP on

In a 24 page decision released April 13, 2017, Judge Walrath of the Delaware Bankruptcy Court denied a motion for summary judgment in a preference action brought by Charles Stanziale as the chapter 7 Trustee of Powerwave...more

DE Bankruptcy Court Dismisses Preference Complaint Against Former Insider in Part with Prejudice

by Fox Rothschild LLP on

Not uncommonly, a preference complaint fails to adequately allege that the transfers sought to be recovered by the trustee were made “for or on account of an antecedent debt owed by the debtor before such transfer was made”,...more

Courts Continue Trend of Recognizing Tribal Immunity in Bankruptcy Proceedings

by Holland & Knight LLP on

Judge Christopher S. Sontchi of the U.S. Bankruptcy Court for the District of Delaware (Court) issued a decision on Feb. 28, 2017, that has important – and positive – significance for Native American tribal governments, their...more

Court Finds That There Is A Fact Issue On Whether Corporate Shareholder And Officer Breached Fiduciary Duties To Creditors

by Winstead PC on

In Tow v. Wellington Yu, a bankruptcy trustee sued a corporation’s shareholder and officer for breaching fiduciary duties by entering into a settlement agreement that required the sale of real estate where the defendant would...more

Paid Rejection: Bankruptcy Court Allows Professional Fees Despite Trustee’s Flawed Strategy

by Robins Kaplan LLP on

Can a bankruptcy court deny fees requested by a professional simply because her client chose a poor strategy? The Bankruptcy Court for the District of Idaho recently rejected such a notion, holding that an accounting...more

Effectively Defending Adversarial Actions Brought Against Former D&Os in Bankruptcy Court

When private equity investors, hedge funds, distressed asset funds, major shareholders or founders step up and take board positions to help guide or turnaround a troubled company, they often do so for all the right reasons....more

Chris Lazarini Comments on Scope of Bankruptcy Rule 2004 Examination

by Bass, Berry & Sims PLC on

Bass, Berry & Sims attorney Chris Lazarini commented on a case in which objectors (a law firm, banks and accountants) opposed a bankruptcy trustee's Rule 2004 Motion requesting information related to his investigation of...more

Creditors Committees’ Members May Not Be Sued Absent Bankruptcy Court’s Permission

by Dechert LLP on

The Barton doctrine (named after the Supreme Court case Barton v. Barbour, 104 US 126 (1881)), generally prohibits suits against receivers and bankruptcy trustees in forums other than the appointing courts, absent appointing...more

The End of the Road for TransVantage Solutions, Inc.?

The TransVantage bankruptcy case and the resulting efforts by the Trustee to avoid carrier payments made by the defunct freight payment processor has been watched like an upcoming speed trap by the transportation industry...more

Lenders to SPEs: Be Aware, You May Not Have Standing to Appeal a Substantive Consolidation Order

by Dechert LLP on

A substantive non-consolidation opinion is a common feature of structured finance transactions in the U.S. Most, if not all, opine as to what a bankruptcy court would do, but express no opinion on the appellate process. We...more

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