In a departure from prior precedent in the United States Bankruptcy Court for the Southern District of New York (SDNY), a recent opinion by Judge Michael E. Wiles in In re Cortlandt Liquidating LLC,[1] effectively lowered the Bankruptcy Code section 502(b)(6) cap on rejection damages that a commercial real estate landlord may claim, by holding that the cap should be calculated using the “Time Approach,” rather than the “Rent Approach.”
Calculation of Lease Rejection Damages
The March 2023 banking crisis has been an unexpected “stress test” for dealing with liquidity issues.
When state regulators closed Silicon Valley Bank this past Friday, many startups understandably faced severe liquidity issues triggered by the sudden and unexpected loss of access to their deposits.
On January 4, 2023, Judge Glenn of the United States Bankruptcy Court for the Southern District of New York issued a much-awaited decision in the Celsius Network LLC (along with its affiliated debtors, “Celsius” or the “Debtors”) chapter 11 cases relating to the ownership of crypto assets deposited by customers in the Celsius “Earn” rewards program accounts.
Over the span of two weeks in July 2022, two of the largest retail-facing cryptocurrency platforms, Celsius and Voyager, filed for chapter 11 bankruptcy protection.
In New York, it is a standard practice to name all tenants residing in a building when foreclosing upon the property.
A recent decision by a New Jersey bankruptcy court scrambles the law regarding rejected trademark licenses.1 Crumbs was a multi-location bakery that also licensed its trademarks and trade secrets to third parties. In July of 2014 Crumbs filed a Chapter 11 reorganization case and in August of 2014 the court entered an order selling substantially all of the assets of Crumbs to LFAC2 free and clear of liens, claims, encumbrances, and interests.
In a case that should cause lenders heartburn, the United States District Court for the Western District of North Carolina recently ruled that common provisions in a Chapter 11 plan prevented the debtor’s lender from executing on a judgment against the non-debtor owner of the debtor.1 Biltmore is a corporation2 that operates manufactured home parks and sells and rents manufactured homes. McGee is the president and controlling shareholder of Biltmore. Biltmore filed Chapter 11 in January of 2011, and TD Bank was Biltmore’s largest secured creditor.
On August 26, 2014, Judge Robert D. Drain of the Bankruptcy Court for the Southern District of New York issued a bench ruling in In re MPM Silicones, LLC, Case No. 14-22503 (RDD), on several aspects of the plan of reorganization filed by debtor Momentive Performance Materials, Inc., a specialty chemicals manufacturing company, and its affiliated debtors.
On January 17, 2014 the Bankruptcy Court for the District of Delaware issued a ruling in Fisker Automotive Holdings, Inc., et. al., Case No. 13-13087 (KG), which highlights potential risks to both secured creditors and purchasers of claims in bankruptcy section 363 sales. The facts in Fisker are straightforward. Fisker was founded in 2007 to make high-end electric cars and was financed principally with federal and state government loans secured by some, but not all, of Fisker’s assets.
On July 24, 2013 the First Circuit Court of Appeals, applying an “investment plus” test, concluded that a Sun Capital private equity investment fund was engaged in a “trade or business” for purposes of determining whether the fund could be jointly and severally liable under ERISA for the unfunded pension withdrawal liability of the portfolio company.1 Two Sun Capital investment funds, conveniently named Sun Capital Partners III, LP (“Fund III”) and Sun Capital Partners IV, LP, (“Fund IV”) (the “Sun Funds”) collectively owned 100 percent of Scott Brass, Inc.