In drafting a bankruptcy plan, causes of action often appear to be an overlooked step-child. Type A bankruptcy lawyers like us spend hours carefully drafting or dissecting the language on assets, liabilities, potential preferences, plan effective dates, and the like, while spending very little time fleshing out and providing for causes of action held by
“Traps for the Unwary”: § 1129(e) and “Small Business Debtors”
In today’s post, we’ll shift away from the big Delaware cases and focus on a critical “small business debtor” Chapter 11 provision. Over the past 6 years, our firm hasn’t filed many small business cases, mostly because many of our debtors were real estate debtors and, thus, definitionally excluded from the small business category. However,
Revisiting § 1129(a)(7)’s “Best Interests of Creditors Test”
(Indian guest workers protesting alleged human trafficking by Signal International)
Last week, Judge Walrath, a Delaware bankruptcy judge, entered her order confirming the Plan of Liquidation in the Signal International, Inc. Chapter 11. For the backstory on Signal’s July 12, 2015 filing, the Morris James Delaware Business Bankruptcy Report has you covered. The
Loss of Priority Status by § 507(a)(8) Tax Claim Buyers
Claims trading is a thriving cottage industry in bankruptcy cases. By some accounts, it’s a $40B+ business. While we generally anticipate seeing general unsecured claims purchased (whether for strategic reasons related to plan confirmation or economic bets), we’ve seen an increase in purchases of § 507(a)(8) priority tax claims (especially ad valorem tax claims and