JELD-WEN, Inc v Van Brunt (In re Grossman’s Inc), (3d Cir No 09-1563, June 2, 2010)

CASE SNAPSHOT

In re Exide Technologies, 607 F3d 957 (3rd Cir June 1, 2010)

CASE SNAPSHOT

IUE-CWA v Visteon Corporation, 2010 WL 2735715 (3rd Cir July 13, 2010)

CASE SNAPSHOT

In re 15375 Memorial Corporation, et al, 430 BR 142 (Bankr D Del May 17, 2010)

CASE SNAPSHOT

Once a company files a Chapter 11 bankruptcy petition (to sell its assets, reorganize or liquidate), Bankruptcy Code § 1114 sets forth a detailed procedure for the employer to follow to modify or terminate certain retiree benefits. Among other things, § 1114 imposes on the employer the burden of showing that the elimination or modification of benefits is necessary to permit reorganization.

In 1984 a Third Circuit panel decided that the automatic stay did not apply to a right to payment which arose under applicable state law after a bankruptcy petition was filed. Avellino & Bienes v. M. Frenville Co., 744 F.2d 332 (3d Cir. 1984). The Third Circuit tradition is that the holding of a panel in a precedential opinion is binding on subsequent panels. Until this year Frenville remained good Third Circuit law notwithstanding universal rejection by other circuits.

On July 13, 2010, a three-judge panel of the United States Court of Appeals for the Third Circuit unanimously held that auto-parts supplier Visteon Corporation could not terminate health and life insurance benefits for approximately 2,100 retirees during its chapter 11 bankruptcy unless Visteon followed the specific requirements laid out in section 1114 of the Bankruptcy Code, even if Visteon would have had the unilateral right to terminate these benefits outside bankruptcy.1 The Court found that a debtor may terminate any retiree benefits in bankruptcy only if,inter alia, the debt

Introduction

On October 5, 2010, Judge Bruce Black of the United States Bankruptcy Court for the Northern District of Illinois (the “Bankruptcy Court”) issued a ruling in the River Road Hotel Partner LLC, et. al. (the “Debtors”) bankruptcy cases denying the Debtors’ bid procedures motion incident to plan confirmation. The bid procedures motion, among other things, sought the denial of secured creditor’s right to credit bid.

A discovery dispute gave the bankruptcy court an opportunity to rule on the common interest privilege which, the court said, has completely replaced the joint defense privilege for information sharing among clients with different attorneys, citing In re Teleglobe Communications Corp., 493 F.3d 345, 364 n. 20 (3d Cir. 2007). Leslie Controls, Inc., Case No. 10-12199 (Bankr. D. Del. 9/21/10)(Sontchi, B.J.).