On January 7, the Bankruptcy Court for the District of Delaware issued an opinion that may have far reaching effects on cases involving asbestos liability. Companies with potential asbestos liability, and actual and potential asbestos claimants, would be well advised to consider the Court’s opinion.
According to a recent decision from the Delaware Supreme Court, a secured party bears the burden of any mistakes in its security documents. Official Comm. of Unsecured Creditors of Motors Liquidation Co. v. JPMorgan Chase Bank, N.A., No. 325, 2014 Del. LEXIS 491 (Del. Oct. 17, 2014) (“Del.
Pension issues in the American Airlines (AMR) bankruptcy1 have resulted in the Internal Revenue Service (IRS) issuing new final regulations, effective November 8, 2012 (Final Regulations), which broadly impact all debtors facing underfunded pension plan obligations. The Final Regulations provide chapter 11 bankruptcy debtors facing distress terminations of their tax-qualified defined benefit pension plans with the additional option of amending the plans to eliminate accelerated payment options.
The term “frenemy” – a combination of the words friend and enemy – has emerged from modern vernacular to describe someone who is simultaneously a partner and an adversary. The term is perhaps perfectly emblematic of the restructuring process where various constituents make and break alliances in an effort to steer the restructuring process. In so doing, the lines between friend and enemy are often blurred or altered during the course of the restructuring.
In a recent order entered in In re SemCrude, L.P., Case No. 08-11525, the Delaware bankruptcy court (1) clarified the application of Bankruptcy Code section 503(b)(9) to creditors’ priority claims arising from the delivery of goods in the 20 days before a bankruptcy filing and (2) amended a previously entered procedures order to allow for the resolution of disputed “Twenty Day Claims” on their merits.
Trump wins again! But the winner is Trump Entertainment Resorts, Inc. and not the presumptive Republican presidential nominee, Donald Trump.
Individuals may want to think twice before seeking relief under chapter 11 following a recent decision from the Ninth Circuit Court of Appeals. In Zachary v.
Insiders who loot their corporate entities often dispose of the cash proceeds in transactions with third parties. A recent Seventh Circuit opinion, In re Equipment Acquisition Resources, Inc., 14-2174 (7th Cir. October 13, 2015) (the “EAR Opinion”)addresses a common risk faced by a third party who receives cash from the defrauding insider.
When a bankruptcy court ‘‘recharacterizes’’ debt, it causes something the parties have identified as debt to be converted into equity. Unlike an equitable subordination analysis, in which courts determine whether an acknowledged claim should be subordinated to that of other creditors due to a creditor’s inequitable conduct, a recharacterization analysis involves determining whether a debt actually exists.
Compensation to be paid to a bankruptcy estate professional is many times subject to intense dispute. In the case of a bankruptcy trustee, section 326 of the Bankruptcy Code provides for a tiered system of compensation based upon the amount of money distributed by the trustee to parties in interest. However, as demonstrated by the recent decision in In re Virgin Offshore U.S.A., Inc., 2015 Bankr. LEXIS 233 (Bankr. E.D. La. Jan.