Once might be considered an aberration. Is twice the new normal?
The District Court for the Southern District of New York in Lehman Brothers recently threw cold water on a growing body of cases that permit compensation of professional fees incurred by individual members of official committees of unsecured creditors.
In the recent case of Davis v. Elliot Mgmt. Corp. (In re Lehman Bros. Holdings Inc.), 2014 U.S. Dist. LEXIS 48102 (S.D.N.Y. Mar. 31, 2014), the District Court for the Southern District of New York issued a decision barring reorganization plans from paying legal fees of individual members of official creditors’ committees absent a showing of substantial contribution to the estate.
A recent opinion out of the United States Bankruptcy Court for the Eastern District of Virginia (Richmond Division) serves as a reminder to secured creditors to steer clear of conduct that a bankruptcy court may deem inequitable and provide the court with cause to limit the secured creditor’s credit bid rights. In In re The Free Lance-Star Publishing Co.
On April 11, 2014, the United States Court of Appeals for the First Circuit rendered an important decision regarding the long-running bankruptcy case of SW Boston Hotel Venture LLC (“SW”), the developer of the W Boston Hotel. This Advisory focuses on two key rulings made by the First Circuit: (i) when an oversecured creditor’s claim for post-petition interest in a debtor’s chapter 11 case begins to accrue and (ii) how such post-petition interest should be calculated in the instances where it is due.
When Reston-based Simplexity, LLC (known more commonly as Wirefly.com and its related sites) recently filed for chapter 11 bankruptcy it had, sadly, already terminated nearly its entire workforce. According to pleadings filed in the case, Simplexity had hoped to market and sell its assets outside of bankruptcy in order to maximize creditor recovery and preserve the jobs of its employees. Instead, its liquidity reached such a critical level that it was forced to cease operations on March 12 and file for bankruptcy protection on March 16, 2014. Just one day later, on M
A federal district court has ruled that a distressed debt fund is not a “financial institution” for purposes of the assignment provisions of a loan agreement.
Background
The Bottom Line:
Assignees of Loan Only Entitled to One Collective Vote on Plan
The Tenth Circuit Court of Appeals recently considered the question of how much protection is required for a secured creditor to be adequately protected. Banker’s Bank of Kansas, N.A. v. Bluejay Properties, LLC (In re Bluejay Properties, LLC), Bankr. No. 12-22680 (10th Cir. Mar. 12, 2014)(unpublished).