Bankruptcy

  • July 28, 2014

    Pipe Maker PSL NA Gets Final Nod For $11.5M DIP

    A Delaware bankruptcy judge granted PSL North America LLC final approval of an $11.5 million debtor-in-possession package Monday after the industrial pipe manufacturer reached a deal with secured creditors concerned that their liens were being primed by the loan.

  • July 28, 2014

    Detroit Ch. 9 Plan Calls For Monitor With Subpoena Power

    Less than three weeks ahead of a blockbuster confirmation trial, the city of Detroit on Friday submitted a new version of its bankruptcy exit plan that envisions for the first time an extended period of financial oversight by an independent, court-appointed monitor.

  • July 28, 2014

    Plant Insulation Reorg Plan Flouts 9th Circ., Insurers Say

    Insurer creditors for bankrupt Plant Insulation Co. urged a California federal judge on Monday to reverse a bankruptcy court's approval of Plant's latest reorganization plan, arguing that the plan flouts a Ninth Circuit order by forcing Plant's trust to purchase a majority of Plant's shares at four times their value. 

  • July 28, 2014

    Lehman Can't Subordinate CMBS Fraud Claims In Ch. 11

    A New York bankruptcy judge on Monday ruled that Lehman Brothers Holdings Inc. cannot de-prioritize a number of securities fraud claims relating to certain collateralized mortgage-backed securities in its Chapter 11 bankruptcy, saying the MBS are not securities "of the debtor or of an affiliate of the debtor."

  • July 28, 2014

    Argentina Gets OK For Bond Payments On Technicality

    With less than 56 hours left to solve a debt-repayment impasse, Argentina got permission Monday evening to make interest payments on certain bonds because of a newly discovered technicality — but the clock will keep ticking, and the special master for the country's debt crisis announced a new round of talks for Tuesday.

  • July 28, 2014

    Developer Goes After Attys For Bungled Foreclosure Defense

    A Florida property management company on Monday sued its former counsel claiming the firm botched a foreclosure proceeding that ended in a $5.8 million judgment and drove the company into Chapter 11 protection.

  • July 28, 2014

    Fisker Ch. 11 Plan To Disburse Sale Proceeds Gets OK

    A Delaware bankruptcy judge on Monday blessed Fisker Automotive Holdings Inc.’s Chapter 11 liquidation plan, allowing the electric-car maker's estate to distribute the proceeds from its $149.2 million sale to a unit of Wanxiang Group Corp.

  • July 28, 2014

    Fontainebleau Lenders Say D&O Deal Will Harm BofA Suit

    A proposed bankruptcy court settlement of Fontainebleau Las Vegas casino and resort executives’ liability for the failure of the $2.9 billion project came under renewed attack on Friday as mortgage lenders owed more than $700 million complained that it would impair a forthcoming lawsuit against Bank of America NA.

  • July 28, 2014

    McGuireWoods Beats Hospital's Suit Over Suspect LBO

    An Indiana federal judge on Friday cleared McGuireWoods LLP of helping insiders at Heartland Memorial Hospital LLC plunder the health care system's assets during a 2006 leveraged buyout that led to its bankruptcy, finding no impropriety in the underlying transaction.

  • July 28, 2014

    $800M Asbestos Deal Will Let Specialty Products Exit Ch. 11

    RPM International Inc. has agreed to pay nearly $800 million into a trust over four years to handle asbestos-related injury claims against its Specialty Products Holdings Corp. unit and lift the home-repair products maker out of bankruptcy in Delaware, the company announced Monday.

  • July 25, 2014

    Diacetyl Plaintiffs Ask High Court To Review 3rd Circ. Ruling

    Plaintiffs in a class action claiming they were harmed by exposure to food coloring chemical diacetyl have asked the U.S. Supreme Court to review a Third Circuit ruling that Aaroma Holdings LLC cannot be held liable because it purchased those assets from now-bankrupt Emoral Inc., saying the decision sets a dangerous precedent.

  • July 25, 2014

    Bankrupt Kid Brands Seeks To Get $1.35M For IP From Rival

    Bankrupt nursery-products maker Kid Brands Inc. asked a New Jersey judge Thursday for permission to sell brand names like Tiddliwinks, Kids Line, and Perfect Bum to Crown Crafts Infant Products Inc. for $1.35 million.

  • July 25, 2014

    GSE Gets Nod For Ch.11 Plan With $173M Debt-For-Equity Deal

    GSE Environmental Inc., which makes containment products for industrial work sites, won the blessing of a Delaware bankruptcy judge Friday for a Chapter 11 plan that will hand control of the reorganized company to secured lenders in a $173 million debt-for-equity swap.

  • July 25, 2014

    2nd Circ. Nixes Berger & Associates' Fee Clawback Bid

    The Second Circuit on Friday dismissed Berger & Associates Attorneys PC’s attempt to recoup legal fees stemming from an aborted referral agreement, rejecting the law firm's argument that its former business partner was barred from bankruptcy relief for concealing or destroying evidence.

  • July 25, 2014

    Tech Co. Wants Ex-Antonelli Lawyer Around For Patent Trial

    An online technology company on Friday fought to keep a bankrupt attorney formerly with Antonelli Terry Stout & Kraus LLP in a malpractice suit accusing the firm of botching a patent application for online advertising inventions, citing tactical implications.

  • July 25, 2014

    Ambac Finalizes Bond Settlement Ahead Of Detroit Plan Trial

    Bond insurer Ambac Assurance Corp. on Friday unveiled details of a settlement with Detroit over the bankrupt city’s treatment of limited tax-general obligation bonds, reporting it will see a minimum 34 percent recovery that could rise if the city successfully voids a disputed $1.5 billion borrowing.

  • July 24, 2014

    Nortel's US Arm Strikes $1B Bondholder Interest Cap Deal

    The U.S. unit of the bankrupt Canadian Nortel Networks Inc. submitted a settlement deal Thursday that will cap at just over $1 billion the amount of interest the telecommunications company’s bondholders can collect on their holdings, according to a filing in Delaware federal court.

  • July 24, 2014

    Ex-Sentinel CEO Denied Acquittal, New Trial Request

    Former CEO Eric Bloom of the bankrupt Sentinel Management Group Inc.on Wednesday lost a bid to overturn a March guilty verdict that found he operated a $500 million securities fraud scheme, reached by a jury Bloom said made its decision out of laziness and a desire to be finished quicker.

  • July 24, 2014

    Crumbs Gets NJ Court Approval For Bankruptcy Auction

    A New Jersey bankruptcy judge on Thursday gave Crumbs Bake Shop Inc. the green light to move ahead with plans to sell off its assets at a bankruptcy auction in August, with an investor group serving as the stalking horse bidder for the now-shuttered New York cupcake chain.

  • July 24, 2014

    Former BES Chief Arrested As 3rd Espirito Co. Hits Bankruptcy

    Troubles worsened within Portugal’s Espirito Santo banking empire Thursday when prosecutors arrested the former chief executive of Banco Espirito Santo in a money-laundering and tax-evasion probe and a third company in the group sought court protection from creditors.

Expert Analysis

  • SDNY Weighs In On Third-Party Releases In Bankruptcy

    Frank Grese

    U.S. Bankruptcy Judge Sean Lane of the Southern District of New York in the case of Genco Shipping & Trading Limited waded into the controversy by considering the appropriateness of third-party releases — and nonconsensual ones at that, says Frank Grese of Weil Gotshal & Manges LLP.

  • 11th Circ. Extends FDCPA To Bankruptcy Proofs Of Claim

    Jarrett L. Hale

    The Eleventh Circuit’s ruling in Crawford v. LVNV Funding leaves open the possibility that the Fair Debt Collection Practices Act and related state corollary statutes may be applicable to bankruptcy proofs of claim, which will likely result in increased litigation against debt collectors and, potentially, actual creditors, say attorneys with Hunton & Williams LLP.

  • 6 Years In, Why Haven't FRE 502(d) Orders Caught On?

    John A. Rosans

    In this e-discovery era, why aren't more litigants using Federal Rule of Evidence 502(d) orders and affording themselves basic protection of their most sensitive information? Or, if they are moving for such orders, why are they doing it wrong? asks John Rosans of Katten Muchin Rosenman LLP.

  • Rakoff's Foreign Fund Clawback Ruling Has Limitations

    Raniero D’Aversa

    Judge Jed Rakoff’s recent ruling in the case of Madoff Securities gives comfort to foreign investors that the proceeds of their indirect investments in U.S. companies will not likely be clawed back, but it does not come without certain warnings and limitations — especially considering a contradictory Ninth Circuit ruling issued a mere three days prior to Rakoff’s decision, say attorneys with Orrick Herrington & Sutcliffe LLP.

  • Code Trumps Contract In The 5th Circ.

    Debra McElligott

    The Fifth Circuit opinion in Goldsby v. 804 Congress suggests that even where parties agree upon foreclosure-related fees, costs and charges before a bankruptcy, Section 506(b) of the Bankruptcy Code may still trump the provisions of their contract, says Debra McElligott of Weil Gotshal & Manges LLP.

  • Trial-Ready In 180 Days: Prepare For SDNY's Rocket Docket

    Isaac S. Greaney

    A growing trend in the Southern District of New York akin to a sua sponte rocket docket can provide defendants with an opportunity to set the tone of discovery and shift the burden and risks of the schedule to their adversaries, say Isaac Greaney and Jackie Lu of Sidley Austin LLP.

  • When You Are Responsible For Your Book Of Business

    Jennifer Topper

    Finding prospective clients and retaining them has little to do with your legal training and expertise, and yet you have no practice without successful client acquisition and retention. There is no reason you cannot apply your basic legal training to successful sales efforts hinging upon your practice strength and experience, says independent law firm consultant Jennifer Topper.

  • 4th Circ. Provides Guidance On Nondebtor Releases

    Jason W. Harbour

    The Fourt Circuit's second opinion in the case of National Heritage Foundation shows that it is imperative for the proponent of a nonconsensual nondebtor release to provide appropriate evidence to justify approving such a release, although the court did not draw a bright line as to how many of the six Dow Corning factors must be satisfied, say Jason Harbour and Tara Elgie of Hunton & Williams LLP.

  • An Inventive Way To Remove Pure State Court Claims

    Michael E. Blumenfeld

    Nondiverse state court defendants facing purely state law claims that seek to secure federal jurisdiction should determine whether a good faith basis exists to pursue a third-party action against a federal actor in order to trigger the representative U.S. Attorney’s certification and remove such claims under the Westfall Act, say Michael Blumenfeld and Jonathan Singer of Miles & Stockbridge PC.

  • Separate Classification Gone Too Far

    Scott M. Grossman

    A district court decision in CWCapital Asset Management v. Burcam Capital II may bolster the arguments of secured creditors in opposing cramdown efforts by debtors who may have been emboldened by other recent decisions supporting creative classification schemes, say Scott Grossman and Ari Newman of Greenberg Traurig LLP.