Demystifying Administrative Expenses in Bankruptcy

Administrative expenses can qualify as priority claims for unsecured creditors. What are the 3 categories of expenses in chapter 11 bankruptcy cases?

3 Issues for Vendors to Consider When Their Customer Files For Bankruptcy

If a customer files bankruptcy, vendors (trade creditors) should consider administrative priority, critical vendor status, and avoidance actions.

Ponzi Scheme Lender May Be Off The Hook, After All: A Case Study

The Sixth Circuit would quote Ohio case law to explain that “A contract of novation is created where a previous valid obligation is extinguished by a new valid contract, with the consent of all the parties, and based on valid consideration.” In a sense, a novation establishes that the prior contract is fully performed by the novated contract.

“The time to buy is when there’s blood in the streets.” – Baron Rothschild Don’t Panic, There Are Many Opportunities in Bankruptcy When a client or a competitor files for bankruptcy, it is natural to reflect on the downside. What’s going to happen to my outstanding receivable? Is the market primed for a downturn? How am I going to replace any lost business? These concerns are very real and require meaningful thought and discussion. However, solely focusing attention on the downside can prove short-sighted. There are incredible opportunities in bankruptcy […]

There is a seeming irony here in that a company that files for bankruptcy often does not have the cash to do so. That’s where DIP financing comes in.

This series was started with a broad overview of business bankruptcy, but our last few installments have focused on: unsecured creditors the priority scheme in bankruptcy protecting/collecting your claim In this installment, we draw on our discussion of the priority scheme, with a special focus on super and residual priorities. As previously discussed, not all claims are treated the same.  At its foundation, claims can be divided into two general buckets—secured and unsecured.  If there is collateral securing the claim, it is secured.  If not, it’s unsecured.  However, Congress decided […]

This series was started (click here to read from the beginning) with a broad overview of business bankruptcy but our last few installments have focused on unsecured creditors (click here to read about unsecured creditors) and the priority scheme in bankruptcy (click here for the 30,000-foot view or you can find more specific treatment here, here and here). In this installment, we move on to the nuts and bolts of filing, preserving and protecting your claim in bankruptcy. A. File Proof of Claims and Adhere to Bar Dates to Protect Your Claim Of all bankruptcy […]

A written tour of business bankruptcy and its alternatives. If you would like to read from the beginning, this series started here with a broad overview of business bankruptcy. Most recently, the series has focused on the automatic stay, where you can find the 30,000-foot view. Or you can find more specific treatment here, here and here. In this installment, we give a crash course from a particular perspective – the unsecured creditor. When a debtor files for bankruptcy, creditors hold different types of claims or interests against the debtor’s estate.  Generally, […]