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The Delaware Bankruptcy Insider is a premier blog designed to bring its readers a comprehensive analysis of the latest Delaware corporate bankruptcy news and rulings.  Brought to you by Ashby & Geddes, P.A.

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Karen B. Skomorucha Owens, Esq.
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Showing posts in Delaware District Court

Effective October 16, 2014, Delaware District Court Imposes New Filing and Service Deadline

Pursuant to the Delaware District Court’s October 2, 2014 Standing Order, all electronic transmissions of documents (including, but not limited to, motions, briefs, appendices, and discovery responses) must be completed by 6:00 p.m. (Eastern time) in order to be considered timely filed and served that day.  Notwithstanding the foregoing, all electronic transmissions of initial pleadings must be completed prior to midnight Eastern time in order to be considered timely filed that day.  Please refer to the Standing Order and the Court’s Revised Administrative Procedures Governing Filing and Service by Electronic Means for additional information.

Bar Date Notice Insufficient For Unknown Creditors Despite Publication Nationally And Locally

White v. Jacobs (In re New Century TRS Holdings, Inc.), No. 13-1719-SLR, 2014 WL 4100749 (D. Del. Aug. 19, 2014)

The central question in this appeal was whether notice of a debtors’ claims bar date was constitutionally sufficient to afford unknown creditors due process.*  Although publication notice of a bar date in national and local newspapers is often deemed sufficient for unknown creditors, the Delaware District Court held that, under the circumstances of this case, the notice was insufficient and vacated the Bankruptcy Court’s ruling.  In so ruling, the District Court observed that “when the bar… Read More

Delaware District Court Holds Subordination Agreements Enforceable to Subordinate Junior Secured Creditor’s Timely Filed Claim to Those Tardily Filed by a Senior Secured Creditor

Bank of New York Mellon Trust Co. v. Miller (In re Franklin Bank Corp.), No. 13-1713-RGA, 2014 WL 3611596 (D. Del. July 21, 2014)

In this Memorandum Opinion, Judge Andrews of Delaware’s District Court vacated an order of the Bankruptcy Court and held that a secured creditor who tardily filed its claims years after the applicable bar date did not waive its ability to enforce subordination agreements to subordinate a junior secured creditor’s timely filed claims.  The District Court further held that, despite the Bankruptcy Court’s contrary ruling, the senior creditor’s failure to… Read More

Bankruptcy Court’s Jurisdiction Held Not to Extend to Post-Confirmation ERISA/LMRA Claims Asserted Against Reorganized Debtor

Int’l Union v. Visteon Corp., No. 1:13-cv-01742-RGA, 2014 WL 3547014 (D. Del. July 18, 2014)

Through this decision, Delaware District Court Judge Andrews retained jurisdiction over a post-confirmation proceeding commenced by a group of retirees formerly employed by Visteon Corporation (“Visteon”).  More specifically, the plaintiffs asserted, under the Labor-Management Relations Act and the Employee Retirement Income Security Act, that Visteon and others wrongfully terminated their post-employment benefits following Visteon’s emergence from bankruptcy – a right which was reserved by Visteon in its confirmed plan of reorganization.  The defendants urged the District Court to refer the… Read More

Third Circuit in SCH Corporation and Delaware District Court in Tribune Emphasize the Importance of Examining the Relief Sought by Appellants When Deciding An Appeal Equitably Moot

In re SCH Corp., 2014 WL 2724606 (3d Cir. June 17, 2014); Wilmington Trust Co. v. Tribune Co. (In re Tribune Co.), 2014 WL 2797042 (D. Del. June 18, 2014) (consolidated appeals)

In In re Semcrude, L.P., 728 F.3d 314 (3d Cir. 2013), the Third Circuit discussed the analytical framework for evaluating the well-known equitable mootness factors: “(1) whether the reorganization plan has been substantially consummated,… Read More

Bankruptcy Court’s Careful Consideration of Settlement’s Broad Benefit Recognized by District Court

CFI Class Action Claimants v. Singley (In re SCH Corp.), No. 12-1576 (SLR), 2014 WL 1340234 (D. Del. Apr. 2, 2014)

On April 2, 2014, the Honorable Sue L. Robinson of the District Court affirmed an oral ruling of the Bankruptcy Court, approving a post-confirmation settlement reached between SCH Corp., American Corrective Counseling Services, Inc., and ACCS Corp. (together, the “Debtors”) and Carl Singley (“Singley”) (the disbursing agent, litigation designee, and responsible officer for the Debtors), on one hand, and Levine Leichtman Capital Partners III, L.P. (“LLCP”) (the Debtors’ prepetition secured lender and acquirer… Read More

Zero Purchase Price Repo Transactions Held to Qualify Under the Catchall Provision of Section 101(47)(A)(v); Liquidation of Disputed Securities Remanded to Bankruptcy Court for Further Review

George L. Miller, Chapter 7 Trustee for the Estate of HomeBanc Corp. v. Bear Stearns & Co., Inc. (In re HomeBanc Mortgage Corp.), No. 13-1064 (RGA) (D. Del. March 27, 2014)

In this Read More

Debtors’ Funds Purchased in Section 363 Sale Permitted to be Disbursed to Debtors’ Administrative and Unsecured Creditors Over IRS Objections

United States v. LCI Holding Co., Inc., Nos. 13-924 (SLR), 13-1188 (SLR), 2014 WL 975145 (D. Del. March 10, 2014)

On March 10, 2014, Judge Sue L. Robinson of the District Court denied the request of the United States, on behalf of the Internal Revenue Service (the “IRS”), to stay disbursement of funds placed into escrow by a purchaser of debtor-assets intended to satisfy some but not all administrative and unsecured claims asserted against the debtors.  During the chapter 11 bankruptcy cases of LCI Holding Company, Inc. and its affiliated debtors (the “Debtors”), the Debtors’ prepetition… Read More

Fisker’s Capped Credit Bidder is Denied Interlocutory Appeal and Direct Certification to the Third Circuit

Hybrid Tech Holdings, LLC v. Official Committee of Unsecured Creditors (In re Fisker Automotive Holdings, Inc.), No. 14-99 (GMS), 2014 WL 546036 (D. Del. Feb. 7, 2014); Hybrid Tech Holdings, LLC v. Official Committee of Unsecured Creditors (In re Fisker Automotive Holdings, Inc.), No. 14-99 (GMS), 2014 WL 576370 (D. Del. Feb. 12, 2014)

Chief Judge Sleet of the District Court has denied the emergency request of Hybrid Tech Holdings, LLC (“Hybrid”) for leave to appeal the Bankruptcy Court’s order capping for cause Hybrid’s credit bid as well as Hybrid’s emergency request for… Read More

District Court Certifies Estimation Appeal to the Third Circuit – Highlights Its Limited Role in Estimation Appeals

Specialty Products Holding Corp. v. Official Committee of Asbestos Personal Injury Claimants (In re Specialty Products Holding Corp.), No. 13-1244 (SLR), 2014 WL 545780 (D. Del. Feb. 7, 2014)

On February 7, 2014, Judge Sue L. Robinson of the District Court granted a motion filed by appellants, Specialty Products Holding Corp. and its affiliated debtors and debtors-in-possession, for certification of an order, which was entered by the Bankruptcy Court estimating the appellants’ liability for present and future asbestos claims asserted against the appellants’ bankruptcy estates, for immediate appeal to the Third Circuit. … Read More