In HighPoint Resources Corporation, Case No. 21-10565-CSS (Bankr. D. Del. 2021), the U.S. Trustee’s office filed an objection (Dkt. No. 48) to the rapid confirmation of the Debtors’ plan of reorganization, among other things, indicating its concern regarding the recent trend of expedited pre-packaged plans because of their failure to provide interested parties with adequate notice.

Expedited Pre-Packs

Asbestos defendants are one step closer to greater transparency regarding the often illusive bankruptcy trust claims and payments. On Wednesday, November 13, 2013, the U.S. House of Representatives passed H.R. 982, the Furthering Asbestos Claim Transparency (FACT) Act by a 221-199 vote. FACT would amend the U.S. Bankruptcy Code to require trusts formed under a bankruptcy reorganization plan and charged with paying claims connected to asbestos exposure to disclose all demands made by claimants and the basis of any payments made to claimants.

Early evening on February 23, 2021, Belk Inc. and its affiliates (collectively, “Belk”) filed their Chapter 11 bankruptcy petitions in the Bankruptcy Court for the Southern District of Texas. Less than seventeen hours later, Judge Marvin Isgur confirmed Belk’s pre-packed plan of reorganization. Belk is not the first Chapter 11 bankruptcy case to accomplish plan confirmation within the first twenty-four hours after filing a petition, and it certainly won’t be the last. In 2019, Sungard Availability Services Capital, Inc.

Although business bankruptcy filings have trended down in recent months, the lingering legacy of litigation prompted by the surge in filings at the outset of the U.S. financial crisis remains with us and continues to strike many general counsel with unexpected actions for recovery of payments made by the debtor in the run-up to a Chapter 11 case.

Alerts and Updates

The Court’s decision provides greater certainty for creditors who passively retain estate property that they obtained pre-petition.

Adjustments to certain dollar amounts in the Bankruptcy Code may affect your decision and strategy to either file a bankruptcy or in defending certain actions filed against you or your company. The automatic adjustments to the dollar amounts in various provisions of the Bankruptcy Code, 11 U.S.C. 101 et seq. went into effect on April 1, 2013. You may access the official forms by clicking the following link to the United States Courts:

This decision is significant to debt collectors and debt buyers who, according to the dissent, “have ‘deluge[d]’ the bankruptcy courts with claims ‘on debts deemed unenforceable under state statutes of limitations.’”

The Pension Benefit Guaranty Corporation (PBGC) filed an objection on June 14, 2012, in the Delaware bankruptcy court proceedings of RG Steel ("Debtor"), challenging a recent sale by RG Steel's parent entity ("Parent") of a 25-percent ownership stake in the Debtor. If the sale is respected, Parent would fall outside of the Debtor's "controlled group" under the Employee Retirement Income Security Act (ERISA), with the result that Parent may cease to have joint liability for the Debtor's unfunded pension obligations.

It is fair to say that not many, if any, banks have internal controls or policies and procedures to identify and mitigate deficiencies in the bankruptcy practices of banks. Indeed, banks typically rely on their Legal Department or external counsel to make sure banks protect their interests when bank customers file bankruptcy. While the Compliance Department and the Risk Management Department track compliance and risks related to numerous laws, rules and regulations, the Bankruptcy Code and its rules are typically not among those laws and rules.

Where an insured has assigned away its rights to recover available insurance, the insured’s “empty shoes” do not necessarily prevent an excess carrier that pays defense costs rightfully owed by primary carriers from pursuing the primary carriers based a contractual subrogation theory.  An excess carrier proceeding on this basis typically “stands in the shoes of the insured,” obtaining only those rights held by the insured.  Nonetheless, the Fifth Circuit Court of Appeals found last week that where an excess carrier picks up the bill for an insured’s defense, it may recover fr