Despite recent criticisms of venue selection and cries to limit or curtail various provisions of the Bankruptcy Code, a recent decision from the Bankruptcy Court of the Southern District of New York demonstrates that the bankruptcy courts may continue to broadly interpret the scope of their jurisdictional reach and the powers and authorities granted to them under the Bankruptcy Code. In In re JPA No. 111 Co., Ltd., No. 21-12075 (DSJ) (Bankr. S.D.N.Y. Feb.
Overview
Overview
Section 363(k) of the Bankruptcy Code grants secured creditors the right to credit bid up to the full amount of their claim as a form of currency to bid to purchase assets securing their claim from a debtor in connection with a stand-alone sale of assets under section 363(b). In a recent opinion from the Bankruptcy Court for the District of Delaware, In re Aerogroup International, Inc., Judge Kevin J.
The Bankruptcy Code’s cramdown provisions are a powerful tool for debtors in the plan confirmation process. Pursuant to section 1129(a)(10) of the Bankruptcy Code, a plan may be confirmed if, among other things, “at least one class of claims that is impaired under the plan has accepted the plan.” Once there is an impaired accepting class, and assuming certain requirements are met, the plan may then be “crammed down” on all other classes of impaired creditors that reject the plan and those creditors will be bound by the terms of a plan they rejected.
(Bankr. S.D. Ind. Dec. 4, 2017)
The bankruptcy court grants the motion to dismiss, finding the defendant’s security interest in the debtor’s assets, including its inventory, has priority over the plaintiff’s reclamation rights. The plaintiff sold goods to the debtor up to the petition date and sought either return of the goods delivered within the reclamation period or recovery of the proceeds from the sale of such goods. Pursuant to 11 U.S.C. § 546(c), the Court finds the reclamation rights are subordinate and the complaint should be dismissed. Opinion below.
(Bankr. E.D. Ky. Nov. 22, 2017)
(B.A.P. 6th Cir. Nov. 28, 2017)
The Sixth Circuit B.A.P. affirms the bankruptcy court’s dismissal of the Chapter 12 bankruptcy case. The court finds that the bankruptcy court failed to give the debtor proper notice and opportunity to be heard prior to the dismissal. However, the violation of due process was harmless error. The delay in filing a confirmable plan and continuing loss to the estate warranted the dismissal. Opinion below.
Judge: Preston
Attorney for Appellant: Heather McKeever
(6th Cir. Nov. 14, 2017)
(Bankr. W.D. Ky. Nov. 1, 2017)
The bankruptcy court grants the creditor’s motion for stay relief to proceed with a state court foreclosure action. The creditor had obtained an order granting stay relief in a prior bankruptcy filed by the debtor’s son, the owner of the property. The debtor’s life estate interest in the property does not prevent the foreclosure action from proceeding. Opinion below.
Judge: Lloyd
Attorney for Debtor: Mark H. Flener
Attorney for Creditor: Bradley S. Salyer