“… [A]ny sale of [a foreign] debtor[’s] property [in the U.S.] outside of the ordinary course of business can be approved by the bankruptcy court only after notice, hearing, and a finding of good business reasons to permit the sale,” held the U.S. Court of Appeals for the Second Circuit on May 22, 2017. In re Fairfield Sentry Ltd. (“Sentry II”), 2017 U.S. App. LEXIS 8860, at *11 (2d Cir. May 22, 2017).

“[T]he claims of [an individual debtor’s] general unsecured creditors are ‘senior to or equal [to]’” a defrauded investor’s security claim under Bankruptcy Code (“Code”) § 510(b), held the U.S. Court of Appeals for the Ninth Circuit on Aug. 22, 2016. In re Del Biaggio, 2016 WL 4435904, *9 (9th Cir. Aug. 22, 2016). The investor (“F”) had filed a claim against the debtor based on his wrongful failure to fund, through his affiliated limited liability company (“LLC”), his share in an acquisition venture with F.

A Chapter 11 debtor’s impairment in its reorganization plan of two unsecured claims filed by its former lawyer and accountant “was transparently an artifice to circumvent the purposes of” the Bankruptcy Code (“Code”), held the U.S. Court of Appeals for the Sixth Circuit on Jan. 27, 2016. In re Village Green I G.P., 2016 WL 325163, at *2 (6th Cir. Jan. 27, 2016).

The Winding-Up Committee (“WUC”) of the failed Icelandic bank Kaupthing hf. (“Kaupthing”) announced that Oct. 2, 2015 (“Transfer Bar Date”) will be the last date for the filing of Claim Transfer Request Forms (“CTRFs”) for transferring claims filed against Kaupthing. Parties to unsettled claims trades that require assignment of title must submit their CTRFs to Kaupthing’s transfer agent, Epiq Bankruptcy Solutions LLC, or Epiq Systems Limited (“Epiq”) on or before Oct. 2, 2015.

This Alert is one of a series published by Schulte Roth & Zabel that analyzes the report released on Dec. 8, 2014 (“Report”) by the American Bankruptcy Institute Commission to Study the Reform of Chapter 11 (“Commission”), which recommended numerous changes to Chapter 11 of the Bankruptcy Code (“Bankruptcy Code”).

The U.S. Court of Appeals for the Fifth Circuit held on June 23, 2014 that an oversecured lender’s legal fees were subject to the bankruptcy court’s review for reasonableness despite a court-ordered non-judicial foreclosure sale of the lender’s collateral. In re 804 Congress, LLC, ­­__ F.3d ­­__, 2014 WL 2816521 (5th Cir. June 23, 2014). Affirming the bankruptcy court’s power and reversing the district court, the Fifth Circuit found the lender’s utter failure to detail its legal fees with any documentary support to be fatal.

Facts

Chief Judge Loretta A. Preska of the United States District Court for the Southern District of New York affirmed the order confirming SRZ client Quigley Company Inc.’s Chapter 11 reorganization plan on July 30, 2013. As noted in our Alert of June 28, 2013, the plan enables Quigley to emerge from Chapter 11 over the objection of a dissenting creditor class and another group of asbestos personal injury claimants.

The United States Court of Appeals for the Eighth Circuit held on Aug. 3, 2012, that equitable considerations could not prevent a creditor's recouping amounts owed to it by a chapter 7 debtor. Terry v. Standard Ins. Co. (In re Terry), 2012 WL 3139364, *4 (8th Cir. Aug. 3, 2012). Reversing the bankruptcy court and the Bankruptcy Appellate Panel ("BAP"), the Eighth Circuit explained that "once a party meets the same-transaction test . . . a court should not impose an additional 'balancing of the equities' requirement" on the doctrine of recoupment. Id.

The United States Bankruptcy Court for the Southern District of New York, overseeing the bankruptcy cases of Lehman Brothers Holdings Inc. (“LBHI”) and its affiliated debtors (collectively, the “Debtors”), entered an order on Aug.

On September 22, 2010, Bryan Marsal, co-chief executive officer of the restructuring firm Alvarez & Marsal ("A&M") and chief restructuring officer for Lehman Brothers Holdings Inc., presented A&M's State of the Estate report regarding the chapter 11 cases of Lehman Brothers Holdings Inc. and its affiliated debtors (collectively, the "Debtors"). In his overview of the State of the Estate report, Marsal outlined the timeline for plan confirmation, the claims reconciliation process, and recovery analysis:  

Plan Confirmation Timeline