As the automotive industry continues to restructure, whether through self-liquidation or government intervention, suppliers will inevitably be confronted with many of the same issues prevalent 4-5 years ago, including a supplier’s obligation to continue to provide goods post-petition and the supplier’s rights to adequate assurance as a condition to such shipment.
On August 11, a United States bankruptcy judge denied motions to dismiss the Chapter 11 cases of 21 special purpose entity (“SPE”) subsidiaries (the “Subject Debtors”) of General Growth Properties, Inc. (“GGP”). A final order denying the motions was entered on August 28. The decision raises a number of issues, primarily with respect to the role of independent managers, that are of particular interest to the commercial mortgage-backed securities (“CMBS”) industry.
Lessons from the GGP Cases
In our update of October 20, 2008, we reported on whether "negative equity" can be part of a purchase money security interest. (http://www.masudafunai.com/showarticle.aspx?Show=3093) "Negative equity" is the excess of the amount owed on a trade-in item over the market value of the item.
On October 13, 2009, a Florida bankruptcy judge in the TOUSA, Inc.
In Dumont v. Ford Motor Credit Company, the Ninth Circuit Court of Appeals confirms the Bankruptcy Code does not protect a debtor’s personal property collateral if the debtor fails to commit to redeem, reaffirm or assume the underlying loan—even if the debtor continues timely to make loan payments.
The bankruptcy court's opinion exemplifies the second guessing that can confront solvency opinion providers and highlights issues that providers should carefully vet with experienced legal counsel.
On Nov. 10, 2009, a Pennsylvania district court held that secured creditors do not have an absolute right to credit bid1 their debt under the Bankruptcy Code (the “Code”) in an asset sale conducted pursuant to a “cramdown” plan of reorganization that proposes to provide the secured creditors with the “indubitable equivalent” of their claims. In re Philadelphia Newspapers, LLC, Civil Action 09-00178 at 57 (E.D. Pa. Nov. 10, 2009). This decision is on appeal to the Third Circuit Court of Appeals.
Facts
Yesterday, the bankrupt estate of Lehman Brothers Holdings, Inc. (Lehman) sued Barclays Capital, Inc.
Filing a successful proof of claim is the key to unlocking a creditor's right to recover against a debtor in bankruptcy. Only in limited circumstances may a creditor recover against the debtor's estate without properly filing a proof of claim. This article addresses the various stages of filing, attacking and defending a proof of claim.
The Eastern District of Pennsylvania held that secured creditors do not have a right to credit bid their claim when the sale of a debtor’s assets is conducted under a plan of reorganization.