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Bankruptcy Courts

What Constitutes the “Legal Rate” in a Solvent Debtor Bankruptcy Case?

Chapter 11 bankruptcies find the debtor generally to be insolvent, but not always. Occasionally, a debtor will emerge from the bankruptcy process as a solvent entity, and in those situations, Bankruptcy Code §726(a)(5) may entitle creditors of the debtor’s estate to post-petition “interest at the legal rate from the date of filing the petition.”[1] In […]


Healthcare Restructurings: An Overview of Important Issues in Healthcare Bankruptcy Proceedings

Healthcare providers face many pressures, including regulatory compliance costs and the costs of necessary technological and infrastructure investments.  Congress’ repeated attempts to reform healthcare legislation this year have created new uncertainties for the healthcare industry. A survey of financial experts and bankruptcy lawyers predicted the healthcare industry would join the retail industry and oil and […]


When Are Goods “Received by the Debtor” for a Section 503(b)(9) Claim?

Two important decisions by the Third Circuit Court of Appeals and the Delaware Bankruptcy Court shed light on goods in receipt of debtors in Section 503(b)(9) claims.


Chapter 15 Bankruptcy: A Concise Overview

Like commerce in general, bankruptcies are not necessarily restricted by borders. A company that files for insolvency protection in the Caribbean, Europe or the Far East may also have assets or interests elsewhere, like New York or Miami. Under those circumstances, the debtor’s representative may need the assistance of the U.S. bankruptcy courts to achieve […]


Fourth Circuit Approves Recharacterization of Secured Debt Into Equity

A Brief Summary of PEM Entities​: Unsecured Creditors Pulled Down a Secured Creditor In its recent unpublished opinion PEM Entities, LLC v. Province Grande Old Liberty, LLC, 2016 WL 4254917, (4th Cir. Aug. 12, 2016), the Fourth Circuit Court of Appeals affirmed the bankruptcy court’s award of summary judgment to certain unsecured creditors (the “Plaintiffs”) […]


Netflix Barred by Bankruptcy Plan of Relativity From Streaming Films Before Their Release

Relativity Debtors are the “Masterminds” while Netflix sits in “The Disappointment Room” Faced with debts exceeding $1 billion and lacking liquidity, but hopeful that certain assets would bear bountiful fruit in due course, Relativity Fashion, LLC and a host of affiliates (collectively “Relativity”) filed chapter 11 cases in July 2015 in the United States Bankruptcy Court […]


Optimizing Corporate Workouts With Independent Directors and Special Committees

The appointment of independent directors may benefit a financially distressed business throughout its restructuring process, including during a bankruptcy case. An independent director can be conceived of as having no direct or indirect connection to the business, including not being an employee, owner, or other insider of the business and not deriving any income from […]


Alpha Natural Resources Executive Pay Worthy of Football Stars?

As we watched the Broncos and Panthers come out onto the field this evening, we couldn’t help but be reminded of some of the incredible paychecks that the teams’ star players reeled in during this season. Leading them all was Peyton Manning, who earned $17.5 million– slightly more than twice the highest paid running back […]


Ponzi Scheme Lender May Be On The Hook, After All!

The Skinny The Sixth Circuit recently revived a trustee’s $17 million avoidance and claw-back suit against a lender, finding that the lender’s existing security interests could have been extinguished via novation. Impact: secured lenders entering into amended and restated loan documents should adopt definitive and irrefutable language demonstrating that the parties do NOT intend for the new […]


Do’s and Don’ts of Gifting in Bankruptcy: When a Court Will Look a Gift Horse in the Mouth  

The gifting doctrine in bankruptcy is not new and often is used to obtain creditor consensus to a debtor’s proposed exit – either through a chapter 11 plan or a 363 sale. A bankruptcy “gift” typically involves a structurally senior class voluntarily giving some of its property or distribution to a structurally junior class of […]


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