We have blogged several times about mass tort plaintiffs who failed to list their tort claims in prior bankruptcy proceedings, thereby stiffing their creditors. See here, for example. Do they get away with it? Usually not. Courts have routinely sent those tort plaintiffs packing, and two different theories call for that result: (1) lack of standing, and (2) judicial estoppel.

Military veterans often pay a heavy toll for their service from a physical, emotional and even financial standpoint. A new federal law— the Honoring American Veterans in Extreme Need Act of 2019 or the HAVEN Act— aims to address the latter hardship, providing disabled military veterans with greater protections in bankruptcy proceedings.

The United States Court of Appeals for the Seventh Circuit held that payments made by a debtor’s customers to its lender converting a pre-petition loan to a post-petition loan constituted disbursements for the purposes of calculating the statutory fees payable pursuant to 28 U.S.C. 1930(a)(6). In re Cranberry Growers Coop., 2019 U.S. App. LEXIS 21121 (7th Cir. July 17, 2019). This decision, coupled with the increase in the quarterly fees for the U.S.

In Trinity 83 Dev., LLC v. ColFin Midwest Funding, LLC, 917 F.3d 599 (7th Cir. 2019), the U.S. Court of Appeals for the Seventh Circuit held that section 363(m) of the Bankruptcy Code does not moot an appeal involving a dispute over the proceeds of a sale of assets in bankruptcy. In concluding that section 363(m) does not moot such an appeal, but merely provides the purchaser with a defense in litigation challenging the sale, the Seventh Circuit overruled its prior decision on the scope of section 363(m) in In re River West Plaza-Chicago, LLC, 664 F.3d 668 (7th Cir.

In Mission Product Holdings, Inc. v. Tempnology, LLC, 139 S. Ct. 652, 2019 WL 2166392 (U.S. May 20, 2019), the U.S. Supreme Court ruled that the rejection in bankruptcy of a trademark license agreement, which constitutes a breach of the agreement under section 365(g) of the Bankruptcy Code, does not terminate the rights of the licensee that would survive the licensor’s breach under applicable non-bankruptcy law.

In the United States, in a typical plain vanilla lending arrangement, if a counterparty files for bankruptcy, an automatic stay of enforcement actions is imposed that would prevent a lender from (i) foreclosing on the property of the debtor, (ii) terminating contracts with the debtor, (iii) commencing or continuing certain enforcement actions against the debtor or its property and/or (iv) setting off amounts owed under such arrangements (in each case unless a motion is filed and granted in the related bankruptcy case).

The Bottom Line

In In re PT Bakrie Telecom Tbk, Ch. 11 Case No. 18-10200 (SHL) (Bankr. S.D.N.Y. May 30, 2019), the Bankruptcy Court for the Southern District of New York denied a noteholder group’s request for summary judgment seeking denial of recognition of a foreign proceeding under Chapter 15 of the Bankruptcy Code because the debtor had sufficient property in the United States, the appointment of the foreign representative was effective and the Indonesian proceeding was a collective one.

What Happened?

In recent weeks, the dispute in Windstream’s bankruptcy between Windstream and its REIT spinoff Uniti Group over the lease transaction that ultimately led to Windstream’s chapter 11 bankruptcy has continued to escalate with Windstream filing an adversary complaint against Uniti. In its complaint, Windstream seeks to recharacterize the lease as a disguised financing alleging that the lease resulted in a long-term transfer of billions of dollars to Uniti to the detriment of Windstream’s creditors.

On Friday, August 23, 2019, the President signed into law the Family Farmer Relief Act of 2019.

Over the years, much has been written about the Bankruptcy Code’s treatment of small businesses, and the American Bankruptcy Institute Commission’s testimony to Congress this summer made clear that the existing law fell short of providing necessary relief for small businesses. For example, of the 18,000 small business bankruptcy cases filed between 2008 and 2015, less than 27% of those cases resulted in confirmed plans of reorganization. And these numbers excluded countless small businesses that, for a variety of reasons, did not or could not seek bankruptcy relief. See Robert J.