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Ultra Petroleum Corp. Make-Whole Saga Continues

Creditors File Petition for Rehearing En Banc After Fifth Circuit Reversal and Remand of Bankruptcy Court Decision Awarding Creditors Make-Whole and Post-Petition Interest in Accordance with the Terms of the Underlying Agreement.

Executive Summary

USA, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, United States bankruptcy court
To Make-Whole … or Not

Fifth Circuit Holds that Disallowance of Claim Pursuant to the Bankruptcy Code Does Not Render Such Claim Impaired and Casts Doubt on Creditors’ Ability to Recover Make-Whole Amounts or Post-Petition Interest at the Default Contract Rate

Executive Summary

USA, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, Unsecured debt, Liquidated damages, United States bankruptcy court
The court in ResCap denies in part and grants in part secured lenders’ motion to dismiss committee complaint challenging secured status

In an adversary proceeding arising out of the Chapter 11 case of Residential Capital, LLC (“ResCap”), the bankruptcy court denied in part and granted in part a secured lenders’ motion to dismiss certain claims in the case. Official Comm. Of Unsecured Creds. V. UMB Bank, N.A. (In re Residential Capital, LLC), Adv. P. No. 13-01277, -- B.R. --, 2013 WL 4069512 (Bankr. S.D.N.Y. Aug. 13, 2013). At issue was certain collateral, which was part of the secured lenders’ collateral, that the lenders released to enable ResCap to pledge it to different third parties.

USA, New York, Banking, Insolvency & Restructuring, Litigation, Alston & Bird LLP, Collateral (finance), Secured loan, US District Court for the Southern District of New York