Metropolitan Insurance Company has joined ING Clarion Capital Loan Services, Inc., Wells Fargo Bank, N.A., and FRM Funding Company, Inc in requesting the Bankruptcy Court to dismiss as bad faith filings the bankruptcy cases of twenty-one property level CMBS borrower subsidiaries of General Growth Properties, Inc. ING filed the first motion on May 4th with respect to eight debtors, and a hearing was set for May 27th. That hearing was subsequently adjourned to June 17th. Creditors having similar motions to be heard on June 17th were required to file their motions to dismiss by May 29th .
In an unpublished summary order applying New York law, the United States Court of Appeals for the Second Circuit has affirmed a district court's judgment finding that many of the factual allegations asserted in a complaint against the directors and officers of the bankrupt policyholder were excluded by a prior litigation exclusion, even though some of the excluded losses accrued during time periods not at issue in the prior litigation. Pereira v. Gulf Ins. Co., 2009 WL 1262954 (2d Cir. May 6, 2009).
As the federal government and private markets make progress to quell economic recession and stimulate the engines of financial growth, recent headlines from the commercial real estate industry have focused on certain developments, such as the proposed changes in rating agency methodologies and the repeated false starts with the government’s TALF and PPIP programs.
As widely expected, GM and all of its domestic subsidiaries filed voluntary petitions under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York on June 1, 2009. Besides General Motors Corporation, the other three associated debtors are: Chevrolet-Saturn of Harlem, Inc., Saturn, LLC and Saturn Distribution Corporation. Please note that GMAC is not included in these bankruptcy filings.
The Chapter 11 filings on April 16, 2009 by General Growth Properties, Inc. (“GGP”), GGP Limited Partnership (“GGP LP”) and 166 of their shopping center subsidiaries, many of which were formed as bankruptcy-remote, special purpose entities (“SPEs”), raised concerns for the commercial mortgage-backed securities (“CMBS”) industry.
In an unusual ruling recently entered in the Chapter 11 case of Yellowstone Mountain Club, LLC and certain of its subsidiaries, the United States Bankruptcy Court for the District of Montana equitably subordinated the claim of a non-insider senior secured lender. While the equitable subordination of a claim is rare, the Yellowstone decision may signal that courts will be looking at loan transactions with a highly critical eye.
This afternoon, U.S. Supreme Court Justice Ruth Bader Ginsburg issued an order extending the temporary stay placed by a federal appeals court in New York last week on the sale of Chrysler LLC’s assets to a new company, to be partially owned by Italian automaker Fiat S.p.A., to allow opponents to the sale sufficient time to seek Supreme Court review.
Introduction
On March 30, 2009, the United States Supreme Court heard oral argument in Travelers Indemnity Co. v. Bailey,1 a case that addresses the jurisdiction of bankruptcy courts to authorize third-party releases in the context of a debtor’s plan of reorganization.
The current economic recession has, not surprisingly, led to a significant downturn in the domestic gaming industry. During 2008, revenue growth in the U.S. gaming industry turned negative for the first time in four years. Data for the first quarter of 2009 indicate that the monthly gaming revenues of casinos in Las Vegas and Atlantic City declined more than 15% as compared to the first quarter of last year.1 Public gaming company stock prices are down more than 80% on average, and many gaming companies have postponed or canceled development projects.