In many chapter 11 cases, creditors’ committees can play a vital role in maximizing the recoveries of unsecured creditors. But the powers of creditors’ committees are circumscribed by both the Bankruptcy Code and case law.
This week, the Ninth Circuit explains the ins-and-outs of property abandonment under the Bankruptcy Code, and explores the government’s privilege to withhold the identity of informants in discovery.
Partially walking back her prior pronouncements suggesting that she would rule to the contrary (which we previously wrote about here), on October 13, 2021, District Court Judge Colleen McMahon denied the U.S. Trustee’s request for an emergency stay pending appeal of the Purdue Pharma confirmation order.
The Bankruptcy Protector
In the case of In re Ricky L. Moore (19-01228), the United States Bankruptcy Court for the Northern District of Iowa taught an important lesson in the context of Chapter 12 bankruptcy cases[1]: do not rely on repeated assurances of payment from a friendly debtor in lieu of filing your bankruptcy proof of claim.
On October 19, 2021, Monster Investments, Inc., a Maryland-based real estate company, filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Maryland (Case No. 21-16592). The company reports $10 million in assets and $16.5 million in liabilities.
U.S. Bankruptcy Judge Craig A. Gargotta rejected a debtor’s attempt to use “CARES Act” funds, which it did not actually qualify for, to pay creditors in its chapter 11 case.
The Bankruptcy Protector
In the ever-churning waters of the Countryman test for determining whether a contract is executory, the United States District Court for the Middle District of Louisiana recently dipped its toe. The question before the court was whether surety bonds issued to an oil and gas company were executory. The district court, upholding the bankruptcy court below, held that they were not. An analysis of this opinion sheds light on why the surety bonds are not executory and provides lessons for both creditors and debtors, alike.
U.S. Bankruptcy Court for the Western District of North Carolina, October 14, 2021
On October 14, 2021, Teligent, Inc. of Iselin, NJ, a specialty generic pharmaceutical company, filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the District of Delaware (Case No. 21-11332). As of August, 31st, the company reports $85 million in assets and $135.8 million in total debts.
Two recent decisions from Judge Laurie Selber Silverstein of the United States Bankruptcy Court for the District of Delaware address common-interest and attorney work-product protection issues that arose in the bankruptcy case of In re Imerys Talc America, Inc., No. 19-10289 (Bankr. D. Del.).1 Those decisions delineate the interests (and concomitant privilege and work-product protections) of certain parties in Chapter 11 cases, and their reasoning provides instructive guidance on those often misunderstood issues outside of bankruptcy as well.