In re Indianapolis Downs, LLC, et al., 486 B.R. 286 (Bankr. D. Del. 2013)

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In re Maharaj, 681 F.3d 558 (4th Cir. 2012)

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The Court of Appeals for the Fourth Circuit is the first court of appeals to determine whether the absolute priority rule continues to apply to individual chapter 11 debtors. Taking the "narrow view" adopted by certain courts, the Fourth Circuit held that the rule was not abrogated by the amendments of the Bankruptcy Abuse Prevention and Consumer Protection Act, and therefore affirmed the bankruptcy court’s order denying confirmation of the proposed plan.

Congratulations! You have won your case and finally obtained a judgment against that owner or contractor who owes you money. Obtaining the judgment has not been easy. It has required hundreds of hours of time meeting with attorneys, collecting documents, printing e-mails, attending depositions and hearings, and perhaps even testifying at trial, not to mention the money spent on expert witnesses and attorneys. Given that justice has been served, has the time and expense of obtaining your judgment been worth it? Not necessarily.

In many Chapter 11 business bank - ruptcies, the office of the U.S. Trustee (the “UST”) will appoint a representative body of unsecured creditors (the “Com mittee”) to represent the interests of all unsecured creditors. The Committee is selected from unsecured creditors of the debtor who generally hold the largest unsecured claims against the debtor, are not “insiders” of the debtor and are willing to serve. A potential Committee member’s willingness to serve is demon strated through returning the creditor questionnaire to the UST and/or attending the formation meeting when scheduled.

In re ESA Environmental Specialists, Inc., 2013 WL 765705 (4th Cir., Mar. 1, 2013)

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Ad Hoc Group of Vitro Noteholders v. Vitro S.A.B. de C.V., 701 F.3d 1031 (5th Cir. 2012)

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In re Patriot Coal Corporation, et al., 492 B.R. 718 (2012)

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544(b) of the Bankruptcy Code empowers a bankruptcy trustee to avoid any transfer of an interest of the debtor in property that is voidable under "applicable law" by an unsecured creditor. Under the plain language of section 544(b), before a trustee can maintain an avoidance action, the trustee must demonstrate the existence of a qualified creditor, i.e., one who: (i) has a right to avoid the transfers; and (ii) holds an "allowable" unsecured claim. Importantly, the scope of "applicable law" is undefined.

Fundamental restructuring of insolvent companies—in any sector— is a fight for survival.

Given the global nature of the industry, it is perhaps no surprise that shipping companies and their advisors have sought appropriate court protection to alleviate creditor pressure and a possible break-up of the business where a consensual restructuring is not possible.

In re Burcam Capital II, LLC, Case No. 12-04729-8-JRL (Bankr. E.D.N.C., Feb. 15, 2013)

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