In a decision of first impression entered on June 3, 2020, a Chicago bankruptcy court (“Court”) held that a restaurant tenant was excused from paying a significant portion of its rent under the force majeure provisions of its lease because of the governor’s executive order prohibiting in-house dining during the COVID-19 pandemic.[1] This decision is highly significant for landlords and tenants whose ability to service their clients has similarly been restricted by government orders.
A bankruptcy trustee was “not entitled to avoid” a secured lender’s “lien under the Bankruptcy Code” (“Code”), held the U.S. Court of Appeals for the Seventh Circuit on Sept. 11, 2019. In re 180 Equipment, LLC, 2019 WL 4296751, *6 (7th Cir. Sept. 11, 2019). The court rejected the trustee’s argument that the lender’s “lien [was] avoidable because the [lender’s] financing statement failed to properly indicate the secured collateral.” Id., at 1.
Two courts have added to the murky case law addressing a bankruptcy trustee’s ability to recover a debtor’s tuition payments for their children. In Geltzer v. Oberlin College, et al., 2018 WL 6333588 (Bankr. S.D.N.Y. Dec. 4, 2018), a New York Bankruptcy Judge permitted a trustee to claw back payments that parents made to their financially independent adult children for college-related costs. In Pergament v. Brooklyn Law School, et al., 2018 WL 6182502 (E.D.N.Y. Nov.
An asset purchaser’s payments into segregated accounts for the benefit of general unsecured creditors and professionals employed by the debtor (i.e., the seller) and its creditors’ committee, made in connection with the purchase of all of the debtor’s assets, are not property of the debtor’s estate or available for distribution to creditors according to the U.S. Court of Appeals for the Third Circuit — even when some of the segregated accounts were listed as consideration in the governing asset purchase agreement. ICL Holding Company, Inc., et al. v.
We recently wrote about the highly controversial decision of the Delaware Bankruptcy Court in In re Fisker Automotive capping a secured creditor’s right to credit bid its $168 million claim at $25 million.[1] The secured creditor immediately appealed to the District Court.[2] As a procedural matter, the secured creditor had an absolute right to have its appeal heard only if the Bankruptcy Court’s ruling was considered a “final order.” If it was not a “final order,” then the District Court had discretion on whether to hear the merits of the appeal. On Feb.
On Jan. 10, 2014, the United States Bankruptcy Court for the District of Delaware (the “Court”) in In re Fisker Automotive Holdings, Inc., et al., capped a secured creditor’s right to credit bid its $168 million claim at only $25 million (the amount it paid to purchase the claim). The decision is on appeal. While the Court stated that its decision is non-precedential, it serves as a cautionary tale for secured lenders who also are potential acquirers of a debtor’s assets in bankruptcy sales.
Facts
Loan to Fisker
Introduction
Introduction