Recently, the United States Bankruptcy Court for the District of Delaware held that a carve-out provision in a DIP financing order did not act as an absolute limit on the fees and expenses payable to the professionals retained by an unsecured creditors’ committee (the “Committee”). Rather, in In re Molycorp, Inc., 562 B.R. 67 (Bankr. D. Del.

American Apparel, the struggling clothing manufacturer and retailer, found itself in chapter 11 this past November after failing to implement its turnaround plan amid a challenging retail environment. Last week, Judge Shannon in the District of Delaware approved a largely consensual sale of American Apparel’s assets to Gildan Activewear. While the hearing transcript is not yet available, several sources are reporting that, when discussing next steps in the case, Judge Shannon indicated that he is not likely to entertain a structured dismissal.

Status: Upcoming/New Filing

Acquirer: Draper Athena

Acquired: ATopTech, Inc. (US)

Industry: Software

“Always look out for Number One, but don’t step in Number Two” – Rodney Dangerfield

“What-eva – I’ll do what I want [as long as my company is solvent]” – Eric Cartman, South Park

As a company turns in the widening gyre of financial distress, its directors and officers are often confronted with situations that require them to make difficult decisions. Should things fall apart, those decisions may give rise to claims that directors or officers breached their fiduciary duties to the company. A 

In Czyzewski v. Sun Capital Partners, Inc.1, the United States District Court for the District of Delaware affirmed a Bankruptcy Court determination that a private equity firm was not liable for its subsidiary portfolio company’s failure to provide adequate notice of a plant closing under the federal Worker Adjustment and Retraining Notification Act (WARN Act).

Are a debtor’s net operating losses considered property of the estate when they are reported on a consolidated tax return by a non-debtor parent? We previously wrote about this issue here.

Judge Christopher Sontchi of the United States Bankruptcy Court for the District of Delaware has now weighed in on a hotly debated circuit court split.

Proofs of claim filed against a debtor can be as varied as the claimants themselves. Everything from hand-written notes to hundreds of pages of sophisticated corporate documents has been submitted in support of claims. Matters become even more complicated when the claimant is a foreigner relying on foreign law and foreign language documents. In 

As this Blog has discussed in a number of recent posts, free and clear sales under section 363(f) of the Bankruptcy Code often lead to disputes over whether section 363(f) can strip assets of particular types of claims and interests. Although section 363(f) plays an important role in maximizing the value of a debtor’s assets in a section 363 sale, adversely affected parties may object to those assets being sold free and clear of their claims.