Marsh Supermarkets Holding, LLC, and 15 of its affiliates, has filed for chapter 11 bankruptcy protection in the United States Bankruptcy Court for the District of Delaware (Lead Case No. 17-11066-BLS). The petition lists between $0 and $50,000 in assets and between $50 and $100 million in liabilities.
From theory to practice, planning to enforcement, the answers to 42 of the most frequently asked questions can help you prepare, cope or respond to a restructuring. This Client Alert answers some of the most frequently asked questions with respect to the treatment of pension-plan liabilities and other post-employment benefits (OPEB) obligations in US bankruptcies. Understanding the treatment of pension and OPEB obligations in bankruptcy continues to be important in today’s business environment and the law relating to the treatment of these obligations continues to evolve.
This article was published in a slightly different form in the November 2016 issue of Futures & Derivatives Law by The Journal on the Law of Investment & Risk Management Products.
Introduction
(W.D. Ky. May 2, 2017)
The U.S. Bankruptcy Court for the Southern District of New York, after a lengthy trial, dismissed on April 21, 2017 a litigation trustee’s multibillion-dollar bankruptcy-related claims arising out of a December 2007 merger, finding that:
In an opinion by Judge Roth issued on March 30, 2017, the Court of Appeals for the Third Circuit held that two suppliers who had sold electrical materials to a bankrupt contractor had violated the automatic stay by asserting a construction lien against the owner of the development where the contractor had installed the materials supplied.
As noted in a recent Distressing Matters post, the United States Supreme Court in In re Jevic Holding Corp. held that debtors cannot use structured dismissals to make payments to creditors in violation of ordinary bankruptcy distribution priority rules.
Sixth Circuit Determines that an Absolute Assignment of Rents Perfected Under Michigan State Law Takes Property out of a Bankruptcy Estate (In Re Town Center Flats, LLC, Case No. 16-1812 — Decided May 2, 2017)
Don’t forget that ….
judicial estoppel can require dismissal of a claimant’s suit for ERISA-governed long term disability (LTD) benefits if the claimant failed to list the “potential cause of action” in bankruptcy filings.
The key is to determine when the “potential cause of action” accrued. And a recent case says those claims “accrue” when the claimant receives the initial benefit denial letter.
In our article, Jevic: The Supreme Court Gives Structure to Chapter 11 Structured Dismissal, we discussed the narrow holding of Czyzewski et al., v. Jevic Holding Corp., et al., 137 S. Ct. 973, 985 (2017) (“Jevic”), which prohibits non-consensual structured dismissals that violate the Bankruptcy Code’s priority principles.