Introduction

On August 7,  2009, Meridian Automotive Systems ("Meridian") filed a voluntary petition for relief under chapter 7 of the United States Bankruptcy Code.  Soon after Meridian filed its petition for bankruptcy, the Office of the United States Trustee appointed George L.

In September of this year, the Honorable Mary F. Walrath, the presiding Judge in the DHP Holdings bankruptcy, issued a decision addressing the effect of a forum selection clause when deciding a motion to change venue. This issue came before the court in an adversary action filed by DHP against The Home Depot. After DHP filed for bankruptcy, the company sued Home Depot for $5.5 million alleging Home Depot owed the company for an outstanding account receivable.

Summary

Bankruptcy Code § 365(d)(3) requires the trustee or the debtor in possession to "timely perform all the obligations of the debtor . . .arising from and after the order for relief under any unexpired lease of nonresidential real property, until such lease is assumed or rejected, notwithstanding section 503(b)(1)." In 2001 the Third Circuit construed this section to require the debtor to perform the lease in accordance with its terms. CenterPoint Properties v. Montgomery Ward Holding Corp. (In re Montgomery Ward Holding Corp.), 268 F.3d 205 (3d Cir. 2001).

In a recent decision, the Court of Appeals for the Third Circuit (the “Third Circuit”) affirmed¹ the bankruptcy court’s decision in In re KB Toys, Inc.,² and held that a claim that is subject to disallowance under section 502(d) of the Bankruptcy Code in the hands of the original claimant is similarly disallowable when that claim is held by a subsequent transferee because the section is applicable to “claims” rather than “claimants.” This holding is in contrast to a prior decision of the District Court for the Southern District of New York in

Two recent decisions involving health care companies demonstrate how reorganization under Chapter 11 of the Bankruptcy Code¹ can be used to manage large liabilities.

Bond indentures and loan agreements often include make-whole provisions to provide protection to lenders and investors in the event of debt repayment prior to maturity. Make-whole provisions work to compensate the investor/lender for any future interest lost when the issuer/borrower repays the note prior to a specific date.

On December 29, 2011, the US Court of Appeals for the Third Circuit issued an opinion in the chapter 11 bankruptcy case In re Nortel Networks, Inc., holding that the "automatic stay" on creditor collection actions outside the bankruptcy applied to prevent the UK Pension Protection Fund and the Trustee of the UK Nortel Pension Plan from participating in UK pensions proceedings initiated by the UK Pensions Regulator.

The United States Third Circuit Court of Appeals (the "Third Circuit") issued an opinion on February 16, 2011 in the American Home Mortgage chapter 11 proceeding that upheld a determination by the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court") on the valuation of a creditor’s claim that in connection with the termination and acceleration of a mortgage loan repurchase agreement.1 The decision is significant because the Third Circuit affirmed the Bankruptcy Court’s decision that the post-acceleration market value of the mortgage loans was not a relevant m