In re Summer View Sherman Oaks Apartments, LLC (Bankr. C.D. Cal.) Case no. 11-19800

In re MicroBlade, LLC (Bankr. W.D. Wis.) Case no. 11-14981

In re Piedmont Center Investments, LLC (Bankr. E.D. Wis.) Case no. 11-32453

In Green Tree Serv., LLC v. DBSI Landmark Towers LLC,1 a case that is significant for landlords and leasing attorneys, the Eighth Circuit recently held that a subtenant of commercial office space was permitted to vacate its leased premises after the rejection of the master lease and sublease by the debtor-sublandlord, notwithstanding an attornment provision in the sublease requiring the subtenant to attorn2 to the landlord when the landlord either terminates the master lease or otherwise succeeds to the interest of the sublandlord under the master lease.

On September 2, the Delaware Supreme Court affirmed a holding by the Court of Chancery that creditors of insolvent Delaware limited liability companies do not have standing to sue derivatively. This contrasts with Delaware corporations: the Delaware courts have recognized that when a corporation becomes insolvent, creditors become the residual risk-bearers and are permitted to sue derivatively on behalf of a corporation to the same extent as stockholders.

A consortium uniting Apple, Inc. and Microsoft with other top players in the software, electronics and wireless handset industries outplayed Google in a bankruptcy court auction for Nortel’s patent portfolio, posting a winning offer of $4.5 billion for the trove of 6,000 patents that cover fourth-generation wireless, data networking, Internet, and semiconductor technologies.

The Federal Deposit Insurance Corporation (“FDIC”) has approved a final rule authorizing it to clawback any compensation senior executives and directors received within two years of the FDIC being appointed receiver, if the FDIC finds they were “substantially responsible” for the failed condition of a covered financial company. Of particular concern, the rule (implementing section 210(s) of the Dodd-Frank Act):

Introduction

On June 23, 2011, after fifteen years of hugely acrimonious litigation, the Supreme Court of the United States (the “Court”) issued a decision on a narrow legal issue that may end up significantly limiting the scope of bankruptcy courts’ core jurisdiction.  

On June 28, 2011, the Court of Appeals for the Seventh Circuit rejected the views of the Third Circuit and the Fifth Circuit and held that a reorganization plan which proposes the sale of encumbered assets free and clear of liens must honor the secured creditor’s right to credit bid its claim in order to be confirmed under the “fair and equitable” standard of the Bankruptcy Code. In the combined appeals of In re River Road Hotel Partners, LLC, et al. andIn re Radlax Gateway Hotel, LLC, et al.

As revealed in a recent bankruptcy case, purchasers of contaminated property need to have a very clear understanding of their contractual remedies before proceeding with self-help. The case (In re Evans Industries, Inc., No.