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Throughout 2019, the retail industry continued to struggle as numerous retailers — from a variety of product and apparel categories — sought bankruptcy relief. Further, many retailers entered chapter 11 with an intent to liquidate all, or substantially all, of their assets quickly and efficiently. In doing so, debtors and secured lenders utilized standard practices seen across all industries, such as sale-related milestones in DIP orders, but also sought relief unique to the retail industry.
When asked whether a foreclosure sale can be avoided in bankruptcy, the first answer that comes to many practitioners’ minds is “no” because of the Supreme Court’s opinion in BFP v. Resolution Trust Corp.[1] The correct answer, though, is a much more nuanced “it depends.” The Third Circuit’s Sept. 12, 2019, precedential opinion in Hackler v. Arianna Holdings Company LLC[2] is an excellent reminder why.
