In Industrial Enterprises of America v. Burtis (In re Pitt Penn Holding Co., Inc.), 2012 WL 204095 (Bankr. D. Del. Jan.

A significant consideration in a prospective chapter 11 debtor’s strategic prebankruptcy planning is the most favorable venue for the bankruptcy filing.

U.S. federal courts have frequently been referred to as the “guardians of the Constitution.” Under Article III of the Constitution, federal judges are appointed for life by the U.S. president with the approval of the Senate. They can be removed from office only through impeachment and conviction by Congress. The first bill considered by the U.S. Senate—the Judiciary Act of 1789—divided the U.S. into what eventually became 12 judicial “circuits.” In addition, the court system is divided geographically into 94 “districts” throughout the U.S.

As attention shifts from the global financial crisis of 2008–2009 to the global sovereign crisis that currently is affecting much of Europe, lawmakers are scrambling to create new laws and regulations designed to stave off the next financial crisis.[1] Meanwhile, a different threat quietly has been growing in America's states, cities, towns, municipalities, and other political subdivisions.

The importance and practical benefits resulting from the use of the same in-house counsel for an entire corporate family are numerous. For example, the in-house attorneys are particularly familiar with the corporate family’s structure, can assist with joint public filings, and can expertly oversee the corporate family’s compliance with regulatory regimes. If a subsidiary in the corporate family becomes financially distressed, however, the creditors of the financially distressed entity may look to the parent corporation for recourse.

The ability to borrow money during the course of a bankruptcy case is an important tool available to a chapter 11 debtor-in-possession (“DIP”). Often times, the debtor’s most logical choice for a lender is one with an existing pre-bankruptcy relationship with the debtor. As a condition to making new loans, however, lenders commonly require the debtor to waive its right to pursue avoidance or lender liability actions against the lender based upon pre-bankruptcy events.

For the benefit of our clients and friends investing in European distressed opportunities, our European Network is sharing some current developments.

Recent Developments

THE YEAR IN BANKRUPTCY: 2013
Charles M. Oellermann and Mark G. Douglas
The eyes of the financial world were on the U.S. during 2013. The view was dismaying
and encouraging in roughly equal parts. The U.S. rang in the new year with a postlast-
minute deal to avoid the Fiscal Cliff that kicked negotiations over “sequestration”—$
110 billion in across-the-board cuts to military and domestic spending—two
months down the road, but raised income taxes (on the wealthiest Americans) for
the first time in two decades.

Following the culmination of two public comment periods spanning more than a year, the Office of the United States Trustee, a unit of the U.S. Department of Justice (the “DOJ”) assigned to oversee bankruptcy cases, issued new final guidelines on June 11 governing the payment of attorneys’ fees and expenses in large chapter 11 cases—cases with $50 million or more in assets and $50 million or more in liabilities.