WILMINGTON, Del. – The State of Idaho’s Department of Finance has won approval for a court-appointed examiner in the closely watched bankruptcy proceedings of DBSI, Inc., an Idaho-based investment firm. Judge Peter Walsh of the U.S. Bankruptcy Court for the District of Delaware has given the examiner the authority to probe $2 billion in allegedly fraudulent securities transactions made by DBSI. The scheme involved more than 12,000 investors and 270 properties throughout the country.

The following is a list of some recent larger U.S. bankruptcy filings in various industries. To the extent you are a creditor to any of these debtors, or other entities which may have filed for bankruptcy protection, you as a creditor are entitled to certain protections under the Bankruptcy Code.  

BANKRUPTCY REFORM

House panel holds hearing on Circuit City liquidation; questions if BAPCPA to blame.  

AUTOMOTIVE  

Monaco Coach Corp. files Chapter 11 in Delaware.  

Earlier this year, the United States Bankruptcy Court for the District of Delaware ruled that a nondebtor cannot effect a “triangular” setoff of the amounts owed between it and three affiliated debtors, even if the parties had entered into pre-petition contracts that expressly contemplated multiparty setoff.1 In reaching its decision, the Court relied principally on the plain language of section 553(a) of the United States Bankruptcy Code, which limits setoff to “mutual” obligations — i.e., direct obligations between a single obligor and obligee.

The U.S. Bankruptcy Court for the District of Delaware recently issued a decision addressing triangular set-off provisions, which potentially has very far-reaching implications for the enforceability of contractual set-off rights under U.S. law.

In a recent decision, the Bankruptcy Court for the District of Delaware allowed the collateral agent for senior lenders to credit bid for the debtors’ assets even though all of the senior lenders had not authorized the bid. One of the senior lenders had objected to the group’s acquisition of the debtors’ assets by the credit bid. In re GWLS Holdings, Inc., 2009 WL 453110 (Bankr. D. Del. Feb. 23, 2009) (Walsh, J.).

Visteon and Affiliates File for Bankruptcy Protection

Visteon Corporation and related affiliates (“Visteon”) filed voluntary bankruptcy petitions on May 28, 2009, in the United States Bankruptcy Court for the District of Delaware (“Bankruptcy Court”). Visteon intends to continue to operate its businesses while in bankruptcy. Although Visteon UK, Ltd., has already filed bankruptcy in Great Britain, it appears that Visteon’s other non-U.S. subsidiaries will not be filing separate proceedings and will not be part of Visteon’s U.S. bankruptcy proceeding.

The following is a list of some recent larger U.S. bankruptcy filings in various industries. To the extent you are a creditor to any of these debtors, or other entities which may have filed for bankruptcy protection, you as a creditor are entitled to certain protections under the Bankruptcy Code.  

AMUSEMENT PARKS

Theme park operator Six Flags files Chapter 11; seeks expedited approval of pre-pack plan.  

AUTOMOTIVE  

Under section 363(f) of the bankruptcy code, a trustee may sell assets of the bankruptcy estate free and clear of liens and other interests. Generally, absent consent of the lienholder, a trustee may only sell assets free and clear of liens under one of the following conditions:

Masuda Funai routinely represents creditors in bankruptcy proceedings in order to protect their contractual and legal interests and rights to payment. The following is a list of some recent larger U.S. bankruptcy filings in various industries. To the extent you are a creditor to any of these debtors, or other entities which may have filed for bankruptcy protection, you as a creditor are entitled to certain protections under the Bankruptcy Code.  

AUTOMOTIVE  

Cooper-Standards files Chapter 11.  

On August 28, 2009, Delta Financial Corp. (“Delta”) filed a Notice of Appeal to the United States Court of Appeals for the Third Circuit seeking to overturn the dismissal of its coverage action against Westchester Surplus Lines Insurance Co. (“Westchester”) and United States Fire Insurance Co. (“USFI”). The coverage action, which was filed as a part of an adversary proceeding with the United States Bankruptcy Court for the District of Delaware, sought coverage under two D&O policies issued by Westchester and USFI respectively.