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A recent opinion issued by the Ninth Circuit Court of Appeals in the case of Pinnacle Restaurant at Big Sky LLC v. CH SP Acquisitions LLC( In re Spanish Peaks Holdings II LLC)[1] affirmed a holding that would allow, under certain circumstances, the sale of commercial real estate in a bankruptcy case to be free and clear of all liens, claims and encumbrances, including leasehold interests that are generally protected under § 365(h) of the Bankruptcy Code.

Three men had a vision to develop a sports complex in Middleton, Del. They formed a limited liability company called, fittingly, Delaware Sports Complex LLC (hereinafter “DSC”)[1].

DSC was eager to develop its 170-acre sports complex — perhaps too eager, because it entered into a lease one (1) year before the LLC had been legally created. However, the lease contained a term wherein DSC represented and warranted that it was a duly formed and created Delaware LLC.

In the recent case of In re Oakes,[1] the chapter 7 trustee filed an adversary complaint seeking to avoid PNC Mortgage Company’s mortgage on real property owned by the debtors because of a defective acknowledgment of the debtors’ signatures. No one denied that the mortgage was defective or that there was precedent to avoid a mortgage containing a “blank” acknowledgment clause under § 544(a) and Ohio law, but PNC sought to dismiss the avoidance action based on the newly enacted Ohio Rev.

When the U.S. Supreme Court decided BFP v. Resolution Trust Corp.,[1] holding that a mortgage foreclosure sale regularly conducted pursuant to state law could not be avoided as a fraudulent transfer under 11 U.S.C. § 548, it expressly left open the question of whether a tax foreclosure by the holder of a tax lien certificate could be avoided as a fraudulent transfer under that same statute.[2]

            In In re Town Center Flats LLC,[1] the Sixth Circuit Court of Appeals addressed the extent of a debtor’s interest in an assigned stream of rents. The court held that the debtor did not retain sufficient rights in the assigned rents under Michigan law such that the rents were not included in the bankruptcy estate.

In In re RW Meridian LLC,[1] the Ninth Circuit Bankruptcy Appellate Panel considered whether the pre-petition expiration of the Debtor’s right of redemption for unpaid taxes permitted the tax authority to complete a tax sale post-petition without obtaining relief from the stay. The BAP held that the automatic stay applied, voiding the sale.

The increasing relaxation of state laws regulating both the medical and recreational use of marijuana has led to a boom in marijuana-related businesses (“MRBs”). Because MRBs are not exempt from economic forces, however, courts are increasingly being confronted with bankruptcy filings by and against MRBs.