Recently, the Tenth Circuit considered a case involving the question of whether the U.S. Supreme Court’s decisions in Travelers Casualty & Surety Co. of America v. Pacific Gas & Electric Co., 549 U.S. 443 (2007) and in Law v. Siegel, 134 S. Ct. 1188 (2014) affected established Tenth Circuit precedent that a bankruptcy court’s authority to recharacterize debt as equity arises under 11 U.S.C. § 105(a). In its decision inRedmond v. Jenkins, et al (In re Alternate Fuels, Inc.), 789 F.3d 1139 (10th Cir.
A recent decision by the Ninth Circuit Court of Appeals (found here) changes the strategic calculus for a secured creditor deciding whether to file a proof of claim in a bankruptcy case in the Ninth Circuit. It has long been true that a secured creditor does not necessarily imperil his lien if he ignores a bankruptcy proceeding and declines to file a claim in connection with his lien. See U.S. Nat’l Bank in Johnstown v.
Following its sister court in Colorado[1] the United States Bankruptcy Court for the District of Arizona recently held that the debtor’s operation of a business that it illegal under federal law mandates dismissal of an involuntary bankruptcy petition filed against the debtor. In re Medpoint Management, LLC, 528 B.R.
In its opinion in Dewsnup v. Timm, 502 U.S.
In a case of first impression at the Circuit Level, the Ninth Circuit has held that an insider who waives his right to indemnification from a debtor is not a “creditor” for purposes of preferential transfe
Client, with the assistance of its attorney, engages in illegal conduct. Client places money received from its illegal conduct in the attorney’s trust account. Attorney absconds with these illegal funds. When the client brings a non-dischargeability action in the attorney’s bankruptcy case, may the attorney defend the action under the unclean hands doctrine because the funds he stole were gained by the client through its own ille
The Equitable Mootness Doctrine
Current market conditions are straining business relationships in the oil and gas industry. In a growing number of cases, distressed companies are seeking chapter 11 bankruptcy protection. In that event, a creditor-debtor relationship is formed between the bankrupt company and the performing partner. For example, in the context of a joint operating agreement, an operator (the performing partner) may seek to recapture drilling costs from a non-operator (the bankrupt company).
Over the past few months, the economics of the oil and gas industry have changed dramatically. As oil and gas prices have fallen, so too have profit margins and working capital. Many companies will weather this storm. A fortunate few will expand their positions and acquire additional assets, some of which will be purchased from distressed companies. In dealing with these distressed companies and their assets, landmen and other oil and gas industry professionals will need to have a working-knowledge of select bankruptcy-related laws and concepts to protect their company’s assets.