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Showing posts in Judge Kevin Gross

Despite German Decisional and Statutory Authority, Bankruptcy Court Must Still Review Debtorʼs Professional Fees for Reasonableness

In re Solar Trust of America, LLC, No. 12-11136 (KG) (Bankr. D. Del. Jan. 12, 2015)

In this Memorandum Opinion issued by the Honorable Kevin Gross in the chapter 11 cases of Solar Trust of America, LLC (“STA”) and its affiliated debtors, the Delaware Bankruptcy Court determined that a post-petition decision of a German appellate court violated the automatic stay and thus, was void as a matter of law.  Despite contrary arguments, the Court did not find the issuance of the decision ministerial—a usual exception to the automatic stay—not only because the ruling was issued by a judge but… Read More

Issue Of First Impression: Delaware Bankruptcy Court’s Jurisdiction Encompasses The Authority To Approve Rejection Of Expired Collective Bargaining Agreements

In re Trump Entm’t Resorts, Inc., No. 14-12103(KG) (Bankr. D. Del. Oct. 17, 2014)

In a sharply written Opinion, the Honorable Kevin Gross decided an issue of first impression in Delaware:  whether the Court has jurisdiction under Bankruptcy Code section 1113 to rule on a debtor’s motion to reject a collective bargaining agreement (“CBA”) that expired post-petition but its obligations continued status quo pursuant to Federal labor law.  Judge Gross found that the language and legislative purpose of section 1113 establishes the Court’s jurisdiction to enter an order approving rejection.  Applying the facts of the case, His Honor granted the… Read More

Does A Post-Petition Draw On A Letter Of Credit Affect Subsequent New Value Under Section 547(c)(4)? A Closer Look At The Effect Of Post-Petition Payments In The Wake Of Friedman’s

Pirinate Consulting Grp., LLC v. Styron LLC (In re Newpage Corp., et al.), Adv. Proc. No. 13-52443 (KG), 2014 WL 4948421 (Bankr. D. Del. Oct. 1, 2014)

In the wake of the Third Circuit’s Friedman’s opinion, the Court in this decision addressed whether a preference defendant who draws on a letter of credit post-petition may still credit the relevant amounts as subsequent new value under section 547(c)(4) of the Bankruptcy Code.  In denying cross motions for summary judgment on the issue, Judge Kevin Gross illustrated that Friedman’s does not provide a bright line rule in all… Read More

Coal Supply Agreement Held Executory; Pre-petition Payments Thereunder Not Recoverable As Preferences

Pirinate Consulting Group, LLC v. Avoca Bement Corp. (In re Newpage Corp.), Adv. No. 13-52196 (KG), 2014 WL 4948215 (Bankr. D. Del. Oct. 1, 2014)

In this short Memorandum Opinion, Judge Gross was called upon to determine the executory nature of a pre-petition coal supply agreement (the “Coal Supply Agreement”) in order to decide whether certain pre-petition payments to the non-debtor contract counterparty were preferential.  In rendering its decision, the Court relied heavily upon the principles set forth by the Third Circuit in Sharon Steel Corp. v. Nat’l Fuel Gas Distrib. Corp., 872 F.2d 36, 39-40… Read More

An Estate Release Does Not Preclude Tort Plaintiffs From Pursuing Direct, Particularized Claims Against Released Parties

In re Caribbean Petroleum Corp. et al., No. 10-12553 (KG), 2014 WL 3360563 (Bankr. D. Del. July 9, 2014)

In this Memorandum Opinion, the Honorable Kevin Gross held (i) that the Bankruptcy Court has post-confirmation jurisdiction to decide the extent and scope of releases contained in plans it considers and confirms and that (ii) the release at issue made by the debtors in favor of their former officers and/or directors did not prevent third-party tort claimants from pursuing their claims against such released parties. In reaching its jurisdictional conclusion, the Court relied upon the Third… Read More

Bankruptcy Court Dismisses Single Asset Case For Cause, Possibility of Refiling Left Open

In re PEM Thistle Landing TIC 23, LLC, Case No. 13-13273 (KG), 2014 WL 1319183 (Bankr. D. Del. Apr. 2, 2014)

In this Memorandum Opinion, Judge Gross dismissed the single asset chapter 11 bankruptcy case of PEM Thistle Landing TIC 23 (the “Debtor”) for cause, but did not make a finding of bad faith because the Debtor’s commencement of its proceeding to preserve its sole asset from foreclosure constituted a valid business purpose underlying the filing.

On December 17, 2013, the Debtor filed its voluntary chapter 11 petition to stop the foreclosure sale of commercial property (the “Property”)… Read More

Bankruptcy Court Determines Multiple Agreements are Not Integrated; Allows Debtor-Licensee to Assume License Agreement Over Objection of Licensor

In re Physiotherapy Holdings, Inc., No. 13-12965 (KG), 2014 WL 1053117 (Bankr. D. Del. March 19, 2014)

When faced with the question of whether a debtor-licensee was entitled to assume a software license agreement (the “License Agreement”) while rejecting five other agreements with the licensor, the Honorable Kevin Gross held in the affirmative, relying upon the express language of the various agreements and the necessity of the License Agreement to the debtors’ ability to successfully reorganize.

Prior to the petition date, Physiotherapy Holdings Inc. and its various affiliates (together, the “Debtors”) entered into six agreements with Huron Consulting… Read More

Unconscionability Claim Dismissed; Fraudulent Transfer Claim Survives

Ritz Camera & Image, L.L.C. v. Canon U.S.A., Inc. (In re Ritz Camera & Image, L.L.C.), Adv. No. 12-50986 (KG) (Bankr. D. Del. Feb. 4, 2014)

This Memorandum Opinion opines on a routine motion to dismiss federal bankruptcy and state law claims asserted by a chapter 7 trustee against defendant Canon U.S.A., Inc. (“Canon“).  The adversary proceeding was commenced by the trustee following the 2012 filing and conversion of the chapter 11 proceedings commenced by electronics and camera merchandisers, Ritz Camera Centers and its affiliated debtors.  In connection with the debtors’ first… Read More

No “Judgment,” No Attorney Charging Lien; Claim Reclassified

In re Pallet Company LLC, No. 13-11459 (KG) (Bankr. D. Del. Feb. 4, 2014)

In this short Memorandum Opinion, the Honorable Kevin Gross ruled that, under Michigan and Arizona state law, attorney’s charging liens attach only after a judgment is final and favorable to the client.  Therefore, the claimant, who asserted a $301,000 secured claim for prepetition legal services, was entitled only to assert a nonpriority general unsecured claim.

The Debtors hired the claimant, Perkins Coie LLP, to represent them pre- and post-petition to prosecute actions against third parties for misappropriation… Read More

Credit Bidding Limited For Cause Under Section 363(k)

In re Fisker Automotive Holdings, Inc., et al., No. 13-13087 (KG), 2014 WL 210593 (Bankr. D. Del. Jan. 17, 2014)

In a ruling from the bench that was followed by this Memorandum Opinion, the Bankruptcy Court limited a secured creditor’s entitlement to credit bid for cause pursuant to section 363(k) of the Bankruptcy Code.  More specifically, the $75 million bid of Hybrid Tech Holdings, LLC (“Hybrid”), the debtors’ senior secured lender holding approximately $168.5 in claims, was reduced by the Bankruptcy Court to $25 million, the amount Hybrid purchased its claims… Read More