All items from Delaware Bankruptcy Litigation

Introduction
On August 30, 2013, Longview Power, LLC, and various related entities (collectively, “Longview”), filed chapter 11 petitions for bankruptcy in the United States Bankruptcy Court for the District of Delaware.  According to the Declaration of Longview’s CEO (the “Declaration” or “Decl.”), Longview was formed in 2003 for the purpose of building and operating a 700 megawatt coal-fired power plant in Maidsville, West Virginia.  Decl. at *2.  Longview contends that when operating at full capacity, its power plant is one of the most efficient in the country, having some of the lowest air emissions in the United States.  Id
Longview and its affiliates operate in two primary sectors: (i) electricty generation; and (ii) coal mining and processing.  Decl. at *5.  The company operates its power plant through Longview Power and its coal mining operations through Mepco Holdings, LLC.  Although Longview was formed more recently to operate the power plant, Mepco was formed over 50 years ago and describes itself as “one of the largest independent coal companies in North Appalachia.”  Decl. at *2.  Approximately half of Mepco’s annual coal production is sold to Longview through an intercompany supply contract.  Decl. at *2-3.  From July 1, 2012 to June 30, 2012, Longview Power’s revenues totaled $106 million while Mepco’s revenue totaled $149 million.  Id.
Longview’s Financials



Posted 49 weeks 2 days ago

Introduction
On June 10, 2013, Exide Technologies (“Exide” or “Debtor”) filed a petition for bankruptcy under Chapter 11 of the United States Bankruptcy Code. Exide filed for bankruptcy in the United States Bankruptcy Court for the District of Delaware. With operations in over 80 countries, Exide describes itself as “a global leader in stored electrical energy solutions and one of the world’s largest producers and recyclers of lead-acid batteries.” See Declaration of Exide’s CFO in Support of Chapter 11 Petitions and First Day Pleadings (the “Decl.”) at *2-3. 
 
Exide’s business falls into two general categories – transportation and industrial. On the transportation side, Exide manufactures and sells batteries used in cars, trucks, recreational and marine vehicles. In its industrial divisions, the company offers motive and network power batteries. Motive power batteries are used in equipment such as electric forklifts, floor cleaning equipment and the like. Network power batteries, on the other hand, power systems used in telecommunications, computers and health care industries, among others. Decl. at *3. Exide employs over 3,600 employees in the U.S., 1,100 of which are salaried and 2,500 are paid hourly. Decl. at *4. 
 



Posted 1 year 9 weeks ago

Introduction
On April 24, 2013, Robert S. Bernstein, Plan Administrator for the Berkline/BenchCraft bankruptcy estates, began filing complaints with the Delaware Bankruptcy Court seeking to recover what he contends are preferential transfers.  For those not familiar with preference actions, Bernstein contends that certain payments, or "transfers", made to creditors in the months prior to the Berkline bankruptcy are subject to avoidance and recovery pursuant to sections 547 and 550 of the Bankruptcy Code.  According to court papers filed by Bernstein, a pretrial conference is scheduled for July 9, 2013 at 10:30 a.m..
Background
Berkline and various related entities filed chapter 11 petitions for bankruptcy on May 2, 2011.  According to the Declaration of Berkline's Chief Restructuring Office (the "Decl."), Berkline was a "leading North American designer and manufacturer of upholstered and reclining furniture."  Decl. at *2. Berkline manufactured home theater seating, sofas, love seats and sectionals which were sold in furniture stores, department stores, "big box" stores and on the internet.  Two of the company's brands included the "Berkline" and "Benchcraft" lines of furniture.  Id.
Reasons for Bankruptcy



Posted 1 year 14 weeks ago

Introduction
On April 24, 2013, Synagro Technologies ("Synagro") and various affiliates filed chapter 11 petitions for bankruptcy in the United States Bankruptcy Court for the District of Delaware.  Synagro recycles biosolid and organic materials generated by municipal and industrial waste water treatment centers.  The company describes its services to include "drying and pelletization, composting, incineration, alkaline stabilization, land application, collection and transportation, regulatory compliance, dewatering, facility cleanout services and product marketing."  See Synagro's Declaration in Support of Chapter 11 Petitions and First Day Pleadings (the "Decl.") at *3-4.
Operations



Posted 1 year 15 weeks ago

Introduction
On Monday, April 22, 2013, Yarway Corporation filed a chapter 11 petition for bankruptcy in the United States Bankruptcy Court for the District of Delaware.  According to papers filed by Yarway with the Bankruptcy Court, the company’s origins go back to 1908 when it started manufacturing pipe clamps, steam traps and valves.  See Yarway’s Affidavit in Support of First Day Pleadings (the “Decl.”), at *1.  The company was privately owned until 1986, when it was sold to Keystone International, Inc..  Keystone was purchased by Tyco International Ltd. in 1997.  Decl. at *2
Operations
According to its Declaration, Yarway “allegedly manufactured, distributed and/or sold asbestos-containing products, which ceased entirely by 1988.”  Decl. at *2.  The company stopped its manufacturing operations entirely in 2003 when it sold its manufacturing facility to an unrelated third party.  Id.  Even after the company sold off its manufacturing assets, it remained in existence in order to “defend, process and satisfy asbestos-related claims asserted against it.”  Id. It’s these asbestos related claims which are the basis for Yarway filing for bankruptcy.
Reasons for Bankruptcy



Posted 1 year 16 weeks ago

Introduction
On Monday, April 22, 2013, Yarway Corporation filed a chapter 11 petition for bankruptcy in the United States Bankruptcy Court for the District of Delaware.  According to papers filed by Yarway with the Bankruptcy Court, the company's origins go back to 1908 when it started manufacturing pipe clamps, steam traps and valves.  See Yarway's Affidavit in Support of First Day Pleadings (the "Decl."), at *1.  The company was privately owned until 1986, when it was sold to Keystone International, Inc..  Keystone was purchased by Tyco International Ltd. in 1997.  Decl. at *2
Operations
According to its Declaration, Yarway "allegedly manufactured, distributed and/or sold asbestos-containing products, which ceased entirely by 1988."  Decl. at *2.  The company stopped its manufacturing operations entirely in 2003 when it sold its manufacturing facility to an unrelated third party.  Id.  Even after the company sold off its manufacturing assets, it remained in existence in order to "defend, process and satisfy asbestos-related claims asserted against it."  Id. It's these asbestos related claims which are the basis for Yarway filing for bankruptcy. 
Reasons for Bankruptcy



Posted 1 year 16 weeks ago

Introduction
On Monday, April 15, 2013 (the "Petition Date"), The Scooter Store Holdings, Inc. (the "Scooter Store" or "Debtor"), and various related entities filed chapter 11 petitions for bankruptcy in the United States Bankruptcy Court for the District of Delaware.  Based in New Braunfels, Texas, Scooter Store is one of the nation's largest providers of power wheelchairs, scooters, lifts, ramps and other related equipment.  See Declaration in Support of Chapter 11 Petitions and First Day Motions (the "Decl.") at *3.  Scooter Store began its operations in 1991.  Since then, the company has served over 700,000 senior citizens and disabled persons through its equipment offerings and services.  Id.
Company Operations and Debt Structure
At the height of its operations, Scooter Store employed over 2,400 employees in 48 locations throughout the United States.  As of the Petition Date, however, the company had reduced its employees down to 300.  Decl. at *4.  In 2011, Sun Capital Partners purchased a majority voting interest in the company.  Sun owns debts, preferred stock and warrants that represent over 66% of the voting ownership interest in the company.  Decl. at *4-5. The company's debt includes a first lien loan agreement for $25 million, a second lien facility for $25 million and a third lien facility totaling $40 million.  Decl. at *6.
Events Leading to Bankruptcy



Posted 1 year 17 weeks ago

Introduction
Earlier today, Rotech Healthcare ("Rotech"), filed chapter 11 petitions for bankruptcy in the United States Bankruptcy Court for the District of Delaware.  According to a declaration filed by Rotech's President and CEO (the "Declaration" or "Decl."), Rotech describes itself as "one of the largest providers of home medical equipment and related products and services in the United States ..."  The numbers back it up ... Rotech provides medical equipment and services in all 50 states employing over 4,000 employees in 409 operating locations.  Decl. at *3.   Using the information provided in Rotech's court filings, this post will look at Rotech's business, why the company filed for bankruptcy and what Rotech's objectives are now that it is in bankruptcy. 
Business History and Operations



Posted 1 year 19 weeks ago

Introduction
On March 24, 2013, NAMCO, LLC ("NAMCO") filed a chapter 11 petition for bankruptcy in the United States Bankruptcy Court for the District of Delaware.  Based in Manchester, Connecticut, NAMCO sales swimming pool accessories and equipment throughout the Northeast and Mid-Atlantic United States.  See Declaration of Lee Diercks in Support of Chapter 11 Petition and First Day Motion (the "Declaration" or "Decl.") at *2.  In addition to selling pool supplies, NAMCO owns and operates a chemical repackaging center which allows the company to sell and distribute chemicals through its website.  Id.
Operations
Going in to bankruptcy, NAMCO operates thirty-seven (37) stores in ten states. The company's stores range anywhere in size from 11,000 to 60,000 square feet.  In addition to its retail stores, NAMCO operates in 190,000 square feet of office and distribution space and 40,000 square feet for its chemical repackaging center.  Id. at *3. 



Posted 1 year 19 weeks ago

Summary
In an 8 page decision signed February 21, 2013, Judge Gross of the Delaware Bankruptcy Court denied a Motion for Enlargement of Administrative Claim, holding that the movant failed to prove excusable neglect. Judge Gross’s opinion is available here (the “Opinion”).
The Opinion analyzes the motion pursuant to the excusable neglect factors provided in Pioneer Investment Services Co. v. Brunswick Assocs. Ltd. Partnership, 507 U.S. 380, 395 (1993) (“These include, as the Court of Appeals found, the danger of prejudice to the debtor, the length of the delay and its potential impact on judicial proceedings, the reason for the delay, including whether it was within the reasonable control of the movant, and whether the movant acted in good faith.”).Background



Posted 1 year 22 weeks ago