In a recent opinion – In re Heritage Home Group LLC, et al., Case No. 18-11736 (KG), 2018 WL 4684802 (Bankr. D. Del. Sept. 27, 2018) – the Delaware Bankruptcy Court addressed the longstanding issue of which professional persons must be retained under section 327(a) of the Bankruptcy Code.
A fundamental tenet of chapter 11 bankruptcies is the absolute priority rule. Initially a judge-created doctrine, the absolute priority rule was partially codified in section 1129(b)(2)(B)(ii) of the Bankruptcy Code. Under section 1129, plans must be “fair and equitable” in order to be confirmed.
Background: Professionals’ Fees in Chapter 11 cases
Yesterday, the House Judiciary Committee’s Subcommittee on Commercial and Administrative Law concluded its series of hearings on the ramifications of auto industry bankruptcies. Testifying before the committee were:
Panel I:
Today, Treasury Secretary Geithner released a statement on the Presidential Task Force on the Auto Industry.
Yesterday morning, Chrysler Group LLC (formerly New CarCo Acquisition LLC), backed by Italian automaker Fiat S.p.A., acquired substantially all of Chrysler’s assets. Under the terms of the deal, a union retiree trust will initially own 55% of the new company, Fiat S.p.A. will own 20% and the U.S.
Late Sunday night, U.S. Bankruptcy Judge Arthur Gonzalez approved the sale of most of Chrysler's assets to Italian Automaker Fiat S.p.A., as contemplated in the Master Transaction Agreement between the two companies.
In an order dated May 7, 2009, Judge Arthur Gonzales approved Chrysler’s proposed bidding procedures for the sale of substantially all of the Company’s assets to a newly formed entity that would continue business under Chrysler’s name.
On Thursday, under pressure from the Obama administration, Chrysler and 24 of its wholly owned U.S. subsidiaries filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York. None of Chrysler’s Mexican, Canadian or other international subsidiaries are part of the filing.