The Second Circuit Court of Appeals recently issued its decision on a question of first impression before the court: whether section 502(d) of the Bankruptcy Code applies to administrative claims arising under section 503(b) of the Bankruptcy Code. See, generally, ASM Capital, L.P. v. Ames Dept. Stores, Inc. (In re Ames Dept. Stores, Inc.), 582 F.3d 422 (2d Cir. 2009).
There are hundreds of hotel properties in special servicing or foreclosure and even more that are on the brink. When dealing with a distressed hotel property, there are several issues and opportunities to consider.
Receivership
Lehman Brothers Holdings Inc.’s September 15, 2008 bankruptcy was an event of default under thousands of derivatives contracts to which a Lehman entity was a party and for which Lehman Brothers Holdings was the guarantor. This default entitled the vast majority of Lehman’s counterparties to terminate these contracts, and almost all were terminated.
As we count down the days until the New Year, we are reminded of the momentous year we will leave behind us on December 31. While memorable for many things, 2009 may long be remembered as a year of record corporate insolvency. In 2009, General Motors, CIT, Chrysler, and Thornburg Mortgage filed four of the ten largest corporate bankruptcies in U.S. history. Equally notable are the number of corporate filings made in 2009.
The Supreme Court declines to review a circuit court decision in Oneida Ltd., which held that a debtor cannot discharge in bankruptcy, as a prepetition claim, premiums it owes to the Pension Benefit Guaranty Corporation in connection with the termination of a pension plan.
Introduction
Introduction
On Sunday, Citadel Broadcasting, the nation’s third largest radio station operator, filed for Chapter 11 bankruptcy protection after reaching a pre-negotiated restructuring agreement with creditors that hold 60% of the company’s secured debt. Citadel owns and operates 224 AM and FM radio stations that include KABC-AM in Los Angeles, WLS-AM in Chicago, and WPLJ-FM in New York City. New York’s WABC-AM, which is owned by Citadel, is the home of ABC Radio News and also hosts several syndicated radio personalities, including Don Imus and Rush Limbaugh. In documents filed with the U.S.
Bankruptcy Rule 2019, an often ignored procedural rule in U.S. bankruptcies, has returned to the public eye with a vengeance in light of a recent ruling by the influential Bankruptcy Court for the District of Delaware¹ and controversial pending amendments to Rule 2019 proposed by the Committee on Rules of Practice and Procedure of the Judicial Conference of the United States (the “Rules Committee”). The amendments will be the subject of a public hearing held in New York City on February 5, 2010.²
The commercial real estate market is in distress. While residential foreclosures have received the bulk of media coverage, owners of commercial real estate are defaulting on their mortgages at an unprecedented pace. If your business leases commercial space, the likelihood that your landlord will file for bankruptcy is higher now than it has been in recent history. Because a landlord bankruptcy may occur without warning, tenants need to be aware of their rights and responsibilities in the event a filing does occur.
Businesses considering filing Chapter 11 for bankruptcy protection may not necessarily be able to avoid certain environmental cleanup obligations. The underlying policy goals of bankruptcy and environmental laws are in direct conflict in that bankruptcy law seeks to promote financial rehabilitation by discharging a debtor's past obligations in order to promote financial rehabilitation while environmental law seeks to ensure that the government can order responsible parties to clean up contamination, including historical pollution caused by business predecessors.