On Friday August 7th, the NAACP filed a motion to intervene in the chapter 11 bankruptcy cases of Purdue Pharma L.P. and its affiliated debtors (collectively, “Debtors”).[1] The Motion argues that “[i]ntervention is warranted because the NAACP has an interest to ensure that the settlement allocates appropriate relief to communities of color adversely affected by the Opioid Crisis.

The Bottom Line

Recently, in In re Dura Automotive Systems, No. 19-12378 (Bankr. D. Del. June 9, 2020), the Bankruptcy Court for the District of Delaware held that granting the Official Committee of Unsecured Creditors (the Committee) derivative standing on behalf of the debtors – a Delaware limited liability company – was precluded by the Delaware Limited Liability Company Act (the Delaware LLC Act).

What Happened?

Valuation is a critical and indispensable part of the bankruptcy process. How collateral and other estate assets (and even creditor claims) are valued will determine a wide range of issues, from a secured creditor's right to adequate protection, postpetition interest, or relief from the automatic stay to a proposed chapter 11 plan's satisfaction of the "best interests" test or whether a "cram-down" plan can be confirmed despite the objections of dissenting creditors.

In In re Rogers Morris, 2020 WL 1321894 (Bankr. N.D. Miss. Mar. 16, 2020), the U.S. Bankruptcy Court for the Northern District of Mississippi contributed to an existing split among the courts by joining the majority view in holding that a creditor may exercise setoff rights after the confirmation of a plan in a bankruptcy case.

With data privacy issues constantly in the news, what do businesses need to know about handling personal information when they’re considering bankruptcy, especially if some personal information – like customer records – may be a valuable asset?

Appointment of PROMESA Financial Oversight Board Was Constitutional

Almost 12 years after the commencement of the Lehman Brothers bankruptcy case, we now know the answer to one of that case’s most interesting questions—namely, whether so-called “flip clauses” are protected settlement payments or void as ipso facto bankruptcy provisions.

Joseph Wielebinski is praised by peers around the globe as “an excellent lawyer” when it comes to representing clients in financial fraud, money laundering and other white-collar crime proceedings.

Questions & Answers

Given the devastating economic impact of the coronavirus, experts expect a tidal wave of bankruptcies. We are already seeing the growing crest of that wave with Chapter 11 filings by household names such as Neiman Marcus, JCPenney, J.Crew, Hertz, and the ubiquitous fast-casual restaurant chain Le Pain Quotidien. The impact is global—in the UK, department store Debenhams and Byron Burger have also gone into administration.

July Bankruptcy and Restructuring Developments