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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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Recent Posts
- Third Circuit Reversal Paves the Way For NextEra to Potentially Recover Administrative Expenses Incurred in Connection With Failed Merger
- Delaware District Court Disagrees with Bankruptcy Court’s Ruling and Holds That Committee’s Challenge Rights Survived Entry of the Sale Order and Consummation of Sale
- “Straddling the Line”: Delaware Bankruptcy Court Rules That Not All Tax Liabilities Incurred During a Debtor’s Petition Year are Eligible for Administrative Expense Priority
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Third Circuit Upholds Bankruptcy Court’s Approval of 9019 Settlement – Acknowledges Court’s Bank of Knowledge Gathered Throughout a Bankruptcy Case
Mangano v. ID Liquidation One, LLC (f/k/a Indianapolis Downs, LLC), No. 13-3386, 2014 WL 6155944 (3d Cir. Feb. 19, 2014)
In this non-precedential Opinion, the Third Circuit was faced with an appeal of an order entered by the District Court, affirming a Bankruptcy Court order, pursuant to Bankruptcy Rule 9019, approving a settlement between a set of long-standing litigants – the debtors, Indianapolis Down, LLC (n/k/a ID Liquidation One, LLC) and Indiana Downs Capital Corp. (n/k/a ID Liquidation Two, Inc.) (collectively, the “Debtors”), on one hand, and Power Plan Entertainment Casino Resorts Indiana, LLC and Live! Holdings, LLC (collectively, the “Cordish Entities”), on the other. The disputes between the parties, which arose from management and trademark agreements, began in 2010 when the Cordish Entities commenced arbitration. Following the commencement of the Debtors’ chapter 11 cases, the parties settled their issues, including certain counterclaims (the “Counterclaims”) asserted by the Debtors against the Cordish Entities in the arbitration. In challenging the approval of the settlement, certain third parties, called the “Oliver Parties”, asserted that the Bankruptcy Court did not have an adequate record to evaluate the merit and value of the Counterclaims, which were released by the settlement. The Third Circuit dismissed the Oliver Parties’ contention, holding that the entire record developed before the Bankruptcy Court during the Debtors’ chapter 11 cases, including that which was established in connection with certain interrelated disputes between the Debtors, the Cordish Entities, the Oliver Parties, and others, provided the Bankruptcy Court with the necessary record to evaluate the Counterclaims in connection with the settlement. Indeed, it “used what it knew” about the claims at issue to determine that the settlement reflected the exercise of the Debtors’ business judgment and was fair and equitable.