Business Reorganization

Chapter 22s and the Good-Faith Filing Doctrine

The “good-faith filing” doctrine has generated recent precedent and more than a little controversy. A recently published decision from the Georgia bankruptcy court shows that the doctrine has also become a weapon used by courts, that are so inclined, to battle the filing of “chapter 22” (serial chapter 11) cases.

Check Your Partners’ Rates: The “Intra-Firm” Rate Cap Of In Re Fleming Companies, Inc.

At first blush, the recent decision of the Delaware Bankruptcy Court in In re Fleming Companies, Inc., 2003 WL 23018828 (Bankr. D. Del. 2003), appears to be just another example of a not-terribly-pleased bankruptcy judge exercising discretion to reduce fees in yet another mega bankruptcy case. However, chapter 11 practitioners in cases large and small should avoid dismissing the result and look carefully at the rationale.

Securities Trading Orders Questioned

A decision out of the U.S. Bankruptcy Court for the Southern District of New York raises questions about what many have considered to be a routine order in large chapter 11 cases. In In re: Spiegel, Inc., 2003 Bankr. LEXIS 435 (May 7, 2003), the bankruptcy court while not outright denying the application, declined, on the record in front of it, to enter a “Securities Trading Order,” and generally expressed reservations about such orders.

Haste Makes Waste? Preferences and Claims Avoidance in the Murky World of §502(d)

The allowance of claims and recovery of avoidable transfers are important, complementary principles in the adjustment of the debtor-creditor relationship. Like Themis personified, claims are modified or expunged to ensure that distributive justice is accomplished through the bankruptcy claim allowance and distribution process, while preferential transfers are disgorged from creditors who, by accident or design, lingered too long at the well before the commencement of a bankruptcy case.

Rejected Leases: When The Obligations End Depends On What Circuit You’re In

Section 365(d)(3) requires chapter 11 debtors to timely perform all obligations “arising from and after the order for relief under any unexpired lease of nonresidential real property, until such lease is assumed or rejected.” Section 365(d)(3) specifically provides that such sums are due “notwithstanding §503(b)(1).” Thus, obligations can be due under §365(d)(3) even when there is no demonstrable benefit to the estate.

Breakup Fees Revisited: Burlington Industries Inc. and SHC Inc.

Two recent Delaware cases illustrate how courts continue to scrutinize so-called “breakup fees” payable to “stalking horse” bidders in bankruptcy sales.

Minutes for the Joint Meeting of the Business Reorganization Committee and the Investment Banking Committee ABI Annual Spring Meeting, Washington, D.C., April 12, 2003

The meeting was called to order at 8:30 a.m. and Business Reorganization Committee Co-chair Robert Keach advised the attendees that the educational program was a joint presentation by the Business Reorganization Committee and the Investment Banking Committee. He then introduced Anthony Schnelling, co-chair of the Business Reorganization Committee, and welcomed Peter Kaufman, co-chair of the Investment Banking Committee.

Spring Brings Trio of Cases About Retention of Chapter 11 Professionals

A series of recent decisions brings clarity to issues involving retention of chapter 11 professionals. Chapter 11 counsel, financial advisors, investment bankers and accountants, as well as other professionals, should take note of a trio of recent decisions.

Third Circuit Decision Impacts Commercial Landlord Rights

The influential Third Circuit Court of Appeals in Solow v. PPI Enterprises (U.S.) Inc., et al. (In re PPI Enterprises (U.S.) Inc., Docket No. 01-4140, March 28, 2003 (Scirica, J.) recently decided a case with potential for significant impact on commercial landlords.

Third Circuit Courts Continue Broad Definition of §510(b) “Damages”

In a recent decision, the U.S. District Court for the District of New Jersey, relying on the Circuit’s decision in In re Telegroup Inc., 281 F.3d 133 (3d Cir.

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