Bed Bath & Beyond, the home goods retailer, has filed bankruptcy under Chapter 11 and plans to conduct liquidation sales and close all of its brick-and-mortar stores by June 30, as reported by The New York Times. The retailer points to an inability to adjust to the growth of online shopping as a reason for its downfall.
On February 13, 2023, Ultra Petroleum Corporation (“Ultra”) filed a petition for a writ of certiorari with the US Supreme Court seeking review of the Fifth Circuit’s October 2022 ruling that, in solvent-debtor cases, debtors must pay unsecured creditors applicable contractual make-whole premiums and postpetition interest at contractual default rates in order for such unsecured creditors to be considered unimpaired.
In a January 2023 opinion,1 the Southern District of New York Bankruptcy Court overseeing the bankruptcy case of Latin American airline Avianca and certain of its affiliates sanctioned over 150 of the airline’s Brazilian and Columbian creditors who had filed proofs of claim in the bankruptcy case finding t
In a decision likely to have significant impact on certain types of bankruptcy filings going forward, this morning, the Third Circuit Court of Appeals ordered the dismissal of the Chapter 11 bankruptcy case filed by Johnson & Johnson affiliate LTL Management LLC.
The recent High Court judgment in Re CGL Realisations Limited (In Liquidation) in favour of Geoff Carton-Kelly as additional liquidator of failed electrical retailer Comet ordered the company’s former French parent, Darty, to pay over £100m to restore the preferential repayment of an intercompany loan owed to Darty in the run-up to Comet’s sale shortly before its insolvency. The additional liquidator was appointed in 2018 by the court specifically to investigate the circumstances of Comet’s sale in advance of its demise in 2012.
On October 19th, the Wall Street Journal reported that the electric vehicle startup Mullen Automotive Inc., gained court approval to buy an Indiana manufacturing plant and assets from Electric Last Mile Solutions for $92 million. Such deal, which boosted Mullen’s share prices by 64%, includes Electric Last Mile Solutions’ manufacturing plant in Mishawaka, Indiana and its inventory and intellectual property.
The costs regime in insolvency litigation is outdated and not fit for purpose, especially when it comes to the clawback claims designed to allow officeholders to restore the insolvent estate when assets have been deliberately dissipated. Many such claims can become uneconomical to run, especially where recipients of dissipated assets have no desire to preserve them but every incentive to diminish them with their own costs. Often a sale or assignment is the last resort to seek justice against wrongdoers in such situations.
In its June 6, 2022 opinion in Siegel v. Fitzgerald, the United States Supreme Court resolved a circuit split and invalidated a 2017 statute that increased U.S. Trustee fees in 48 states—but not Alabama or North Carolina—as unconstitutional under the uniformity requirement of the Constitution’s Bankruptcy Clause. See Siegel v. Fitzgerald, 596 U.S. ___ (2022).
U.S. Trustee Fees, a History
Background
In a recent decision, Judge David Novak of the US District Court for the Eastern District of Virginia vacated the Chapter 11 plan confirmation order entered by the bankruptcy court in the Mahwah Bergen Retail Group (formerly known as Ascena Retail Group) case, holding that the plan’s non-consensual third-party releases were unenforceable.1 The ruling arrived shortly after an