All items from Business Finance & Restructuring News - Weil

As the unofficial last day of summer approaches, we imagine many of you are heading out of your offices early to enjoy one last long weekend of swimming, barbequing, and just plain ol’ relaxing.  In honor of the Labor Day weekend, we at the Weil Bankruptcy Blog are taking a well-deserved day off today.  We’ll be back on Tuesday with some exciting news. So be sure to check back with us then. In the meantime, have a great weekend!



Posted 3 days 11 hours ago

Some of our readers may have had the pleasure of renting a resort villa during their summer vacation (electronic postcards of such fancy digs are always welcome at the Weil Bankruptcy Blog, especially if you pose for a photo where you are reading one of our entries!). For the uninitiated (including yours truly), villas are often viewed as the ultimate upgrade for privacy and convenience when staying at a large resort for a week or more—a private home with the luxuries of a full service hotel. A villa is not exactly the first thing that comes to mind when thinking of real estate bankruptcies, but the recent decision by Judge Lane of the United States Bankruptcy Court for the Southern District of New York in the chapter 11 cases of In re MSR Resort Golf Course LLC gives a glimpse into the business behind these luxury rentals.



Posted 4 days 12 hours ago

Proofs of claim filed against a debtor can be as varied as the claimants themselves. Everything from hand-written notes to hundreds of pages of sophisticated corporate documents has been submitted in support of claims. Matters become even more complicated when the claimant is a foreigner relying on foreign law and foreign language documents. In Solar Trust of America, LLC, the United States Bankruptcy Court for the District of Delaware recently reminded a claimant—specifically a law firm—that the materials submitted with a proof of claim must be complete and must be completely translated into English, if the claimant wishes to rely on them in support of its claim.
Background



Posted 5 days 12 hours ago

The difference between a contested matter and an adversary proceeding is relatively simple – a contested matter involves a contested request for relief in the context of the main bankruptcy proceeding (pursuant to Rule 9014 of the Federal Rules of Bankruptcy Procedure), while an adversary proceeding involves the filing of a complaint, commencing a separate proceeding governed by the “7000” series of the Bankruptcy Rules. What necessitates an adversary proceeding, and under what circumstances will a simple “contested matter” suffice? Strictly speaking, certain matters must be resolved in an adversary proceeding, rather than upon a motion in the main bankruptcy case. Such matters are listed in Rule 7001 of the Federal Rules of Bankruptcy Procedure and include (but are not limited to) proceedings to:



Posted 6 days 11 hours ago

The United States Court of Appeals for the First Circuit contributed to a circuit split regarding jurisdiction in its recent decision in Pinpoint IT Services, LLC v. Rivera (In re Atlas IT Export Corp.). In this case, the court considered whether orders denying relief from the automatic stay are final and appealable as a matter of right. Over a dissent, and contrary to the decision of seven of the eight circuits that have considered the question, the court held that such orders are not final unless they have definitively decided a discrete, fully-developed issue that is unreviewable in another forum.
Dueling Lawsuits



Posted 1 week 8 hours ago

INTRODUCTION
Today we bring you the sequel to last year’s four-part series on United States v. Bond — the tale of three related telecommunications corporations (which we will refer to as the “PT-1 debtors”) whose chapter 11 cases spawned a series of tax-related disputes. Now, the Second Circuit has weighed in, and its decision serves as an important reminder to drafters of chapter 11 plans that a plan cannot bestow powers on parties that the Bankruptcy Code does not.
BACKGROUND



Posted 1 week 3 days ago

In 1932, J. Howard Marshall and William O. Douglas co-authored an article published in the Columbia Law Review titled “A Factual Study of Bankruptcy Administration and Some Suggestions.” Douglas (not yet 35 years old) would go on to become the longest-serving justice of the Supreme Court.   But those of us at the Stern Files are not concerned with Justice Douglas (at least at present). Instead, we are concerned with a young J. Howard Marshall. Just 27 years old at the time of the article’s publication, Marshall was a recent graduate and an assistant dean at Yale Law School, teaching (among other things) classes on bankruptcy. More than 60 years before he married Anna Nicole Smith, and nearly 70 years before the Supreme Court decided Stern v. Marshall, young Mr. Marshall undertook a data-driven analysis of the then-existing bankruptcy regime so as to initiate some proposals for reform and for making the bankruptcy process more fair and efficient.



Posted 1 week 4 days ago

As a general matter, governance provisions in a chapter 11 debtor’s organizational documents continue to apply postpetition.  But what if those governance provisions prevent the debtor from engaging in an act expressly authorized by the Bankruptcy Code?  This issue was recently addressed by the United States Bankruptcy Court for the Southern District of Florida in In re DocAssist, LLC, where the court held that a debtor-LLC could not obtain postpetition financing pursuant to section 364 of the Bankruptcy Code without first obtaining the approval of a supermajority of its members as required by its operating agreement.
In re DocAssist, LLC



Posted 1 week 5 days ago

In Levin v. Miller, a recent decision out of the Seventh Circuit, Judge Easterbrook clarified the types of claims that the Federal Deposit Insurance Corporation may assert under section 1821(d)(2)(A)(i) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 after it takes over a failed bank.  Section 1821(d)(2)(A)(i) grants the FDIC “all rights, titles, powers, and privileges of the insured depository institution, and of any stockholder, member, accountholder, depositor, officer, or director of such institution with respect to the institution and the assets of the institution” (emphasis added). Judge Easterbrook, consistent with the FDIC’s own interpretation, held that section 1821(d)(2)(A)(i) applies only to derivative stockholder claims. The most interesting part of the decision, however, was Judge Hamilton’s concurrence. In his concurrence, Judge Hamilton strongly advocated – on public policy grounds – for a broader interpretation of section 1821(d)(2)(A)(i) that encompasses direct claims by stockholders against a failed bank in addition to derivative claims.
Background



Posted 1 week 6 days ago

NORTH OF THE BORDER UPDATE
This article has been contributed to the blog by Edward Sellers and Joshua Hurwitz. Edward Sellers is a partner in the Insolvency & Restructuring group and Joshua Hurwitz is an associate in the Insolvency & Restructuring group at Osler, Hoskin & Harcourt.
Introduction
The Ontario Superior Court of Justice lifted a Companies’ Creditors Arrangement Act (the CCAA) stay and modified a Claims Procedure Order (“CPO”) to permit a class action proceeding which had not been filed by the CPO claims-bar date. Re Timminco Ltd. (2014), 2014 ONSC 3393, 2014 CarswellOnt 9328 (Ont. S.C.J.) (Re Timminco) highlights the discretionary nature of both stay and claims-bar orders under the CCAA and aligns this discretion with the purpose of the CCAA.
Facts



Posted 2 weeks 9 hours ago