Creditor defeats preference action based on ‘new value’ defense

In re ESA Environmental Specialists, Inc., 2013 WL 765705 (4th Cir., Mar. 1, 2013)

CASE SNAPSHOT

Filed under:
USA, Insolvency & Restructuring, Insurance, Litigation, Projects & Procurement, Reed Smith LLP, Letter of credit, Debtor, Collateral (finance), Debt, Liquidation, Certificate of deposit, European Space Agency, Fourth Circuit
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP
Defrauded initial lien holder maintains priority over subsequent innocent lenders

In re RAG East, LP– Case no. 12-04545-CMB (Bankr. W.D. Pa. March 4, 2013)

CASE SNAPSHOT

The court granted summary judgment in favor of a defrauded lender in a lien priority dispute with subsequent third-party lenders. The court determined that the lien of a purchase money mortgage that was allegedly released pursuant to a fraudulent satisfaction piece nonetheless had priority over the liens held by innocent third parties who provided loans to the debtor without notice of the fraud.

FACTUAL BACKGROUND

Filed under:
USA, Pennsylvania, Banking, Insolvency & Restructuring, Litigation, Reed Smith LLP, Debtor, Fraud, Mortgage loan
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP
Secured creditor does not particip ate in bankruptcy case, court allows lien to pass through plan confirmation

In re S. White Transp., Inc., 473 B.R. 695 (S.D. Miss. 2012)

CASE SNAPSHOT

Filed under:
USA, Mississippi, Insolvency & Restructuring, Litigation, Reed Smith LLP, Bankruptcy, Debtor, Secured creditor, United States bankruptcy court, Fifth Circuit
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP
Discrimination in classification of claims okay, so long as not unfair discrimination

In re Sea Trail Corporation, Case No. 11-07370- 8-SWH (Bankr. E.D.N.C., Oct. 23, 2012)

CASE SNAPSHOT

Filed under:
USA, North Carolina, Insolvency & Restructuring, Litigation, Reed Smith LLP, Shareholder, Debtor, Unsecured debt, Discrimination, Market liquidity, Liquidation
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP
Reasonableness of pre-petition default rate under section 506(a) not subject to equitable analysis

In re 400 Walnut Associates, L.P., 2012 BL 140988 (E.D. Pa. June 7, 2012)

CASE SNAPSHOT

The creditor appealed the denial of its claim for pre-petition interest at the contractual default rate. The district court reversed and remanded the case, holding that the bankruptcy court had incorrectly applied an "equitable analysis" in making its decision.

FACTUAL BACKGROUND

Filed under:
USA, Pennsylvania, Insolvency & Restructuring, Litigation, Reed Smith LLP, Debtor, Interest, Default (law), Default (finance), Title 11 of the US Code, United States bankruptcy court
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP
‘Intent’ inferred, summary judgment granted in debt recharacterization case

In re Shubh Hotels Pittsburgh, Inc., Bankr. No. 10-26337JAD (Bankr. W.D. Pa. July 24, 2012)

CASE SNAPSHOT

Filed under:
USA, Pennsylvania, Insolvency & Restructuring, Litigation, Reed Smith LLP, Debtor, Interest, Debt, Balance sheet
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP
Corporate synergy among related debtors key to finding conferral of economic benefit in fraudulent transfer action

Spicer v. Konjoyan (In re Renaissance Hospital, et al.), Adv. No. 10-04190-DML (Bankr. N.D. Texas, Nov. 1, 2011)

CASE SNAPSHOT

Filed under:
USA, Texas, Insolvency & Restructuring, Litigation, Reed Smith LLP, Bankruptcy, Debtor, Fraud
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP
Free-and-clear asset sales price must exceed outstanding debt to satisfy section 363(f)(3)

In re Nance Properties, Inc., Case No. 11-06197- 8-JRL (Bankr. E.D.N.C. Nov. 8, 2011)

CASE SNAPSHOT

Filed under:
USA, North Carolina, Insolvency & Restructuring, Litigation, Reed Smith LLP, Debtor, Debt, Secured creditor
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP
Strict compliance with Section 524(c) required to uphold reaffirmation contract

Sandburg Financial Corp. v. American Rice, Inc. (In the Matter of American Rice, Inc.), No. 11-40301 (5th Cir., Sept. 22, 2011)

CASE SNAPSHOT

Filed under:
USA, Insolvency & Restructuring, Litigation, Real Estate, Reed Smith LLP, Injunction, Debt, Fifth Circuit
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP