What you need to know:
The United States Court of Appeals for the Third Circuit has ruled that secured lenders do not have a statutory right to credit bid their claims in connection with a sale of the debtor’s assets effectuated through a chapter 11 plan of reorganization.
What you need to do:
The U.S. Court of Appeals for the Third Circuit held, in a split decision, on March 22, 2010, that secured creditors do not have a statutory right to credit bid1 their debt at an asset sale conducted under a “cramdown” reorganization plan. In re Philadelphia Newspapers, LLC, et al., --- F.3d ----, 2010 WL 1006647 (3d Cir. March 22, 2010) (2-1).
Equipment maker, Xerium Technologies, filed chapter 11 petitions for bankruptcy on March 30th in the United States Bankruptcy Court for the District of Delaware.
The recent case of Mervyn’s LLC v Lubert-Adler Group IV, LLC, et al. (In re Mervyn’s Holdings, LLC),1 serves as a warning to sellers and equity firms participating in leveraged buyouts to be wary of the effect such buyouts will have on creditors of the target company.
It has been reported that “medical bankruptcies” have been on the rise since 2001. There is no clear-cut definition for “medical bankruptcy,” but it has been summarily defined by the following terms:
Overview
In a recent split decision, a 2-1 majority for the United States Court of Appeals for the Third Circuit ruled that a debtor’s plan of reorganization that proposes a sale of assets free and clear of liens is not necessarily required to allow creditors whose loans are secured by those assets to credit bid at the sale. The majority decision in In re Philadelphia Newspapers, LLC, Nos. 09-4266, 09-4349, 2010 WL 1006647 (3d Cir. Mar. 22, 2010), which follows a similar decision from the United States Court of Appeals for the Fifth Circuit (see Bank of N.Y. Trust Co., NA v.
Since the inception of Tribal1 gaming, billions of dollars have been provided to Tribal casinos by investors and lenders. Clearly, these investments and loans were not considered to be a gamble. Tribal debtors borrow for many reasons; their debt is considered “sovereign” due to their unique legal standing.
Almost five years after the enactment of the Bankruptcy Abuse and Consumer Protection Act, the Supreme Court recently ruled in Milavetz, Gallop & Milavetz, P.A., et al v. United States that attorneys are “debt relief agencies” who are limited in their ability to provide pre-bankruptcy planning advice to consumers and obligating them to provide additional disclosures in their advertisements.
Attorneys Are Debt Relief Agencies Under BAPCPA
Introduction