Postpetition interest is a thorny area of bankruptcy law.  The myriad rules, coupled with the inconsistent way in which they are often applied, provide fodder for litigation and opportunity for confusion.  

The avoidance powers contained in chapter 5 of the Bankruptcy Code permit the recovery of certain prepetition “transfers” made by the debtor – either as a preference under section 547 or as a fraudulent transfer under either section 548 or state common law, made applicable under section 544 of the Bankruptcy Code.  Typically, the “tran

Federal bankruptcy law can benefit debtors and creditors alike. Provisions such as the automatic stay and absolute priority ensure a streamlined proceeding, preserving the debtor’s scarce resources for business rehabilitation and creditor repayment.  The alternative, multiple state court debt enforcement actions, would waste the debtor’s time and money on litigation (as valuable as bankruptcy lawyers may be). 

In the latest installment of our “Breaking the Code” series, we take a look at the rarely-mentioned section 108(c) of the Bankruptcy Code, which governs the effect of certain deadlines relating to nonbankruptcy legal actions:

Typically, when an individual debtor files for bankruptcy, all of his or her belongings become part of the big “property of the estate” pot that the court ladles up pro rata among hungry creditors.  But debtors need to eat too.  Exemption law allows individual debtors and their families to keep some basic property, such as the clothes on their backs and roofs over their heads.

“Once again, I’m not quite sure what that means.” – Bobby Boucher, The Waterboy

Cases analyzing rights under indentures – and the transactions holders and issuers contemplate (or not) under indentures – continue to gain attention in the restructuring world.  Some of those cases involve section 316(b) of the Trust Indenture Act (see our own blog’s recent posts) and payment rights under indentures.  Others, such

It’s hard to believe, but until now, the Seventh Circuit has never weighed in on the issue of when a claim arises in a bankruptcy case.  As a result, the Seventh Circuit has had the luxury of sitting back, watching the Third Circuit go from Frenville to 

Key Takeaway:  Second Circuit allows secured
creditors to opt out of chapter 11 and preserve their liens from discharge.

Interested chapter 11 plan investors, beware. A recent decision by the United States Court of Appeals for the Ninth Circuit held that even after the chapter 11 plan has been confirmed and substantially consummated and your money has been invested, an appeal can go forward even if a victory for the appellants would change the chapter 11 plan terms on which you relied and substantially diminish the value of your investment.