On November 22, 2021, the United States Bankruptcy Court for the Southern District of New York announced a modification to its judge-assignment scheme for “mega chapter 11 cases.” Under the new Local Bankruptcy Rule 1073-1(f), which took effect on December 1, 2021,
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Debtors Beware: Congress Takes Aim At “Eve of Filing” Executive Compensation
Some recent high profile restructuring debtors made multi-million dollar retention bonuses on the eve of bankruptcy filings. The U.S. Government Accountability Office (GAO) took notice of these pre-petition payments and, in September 2021, published a report with data showing that…
Equitable Mootness Doctrine Will Continue to Generate Controversy After Supreme Court Declines to Hear Appeal on the Issue
By Kyle Kolb
The Supreme Court declined to take up a case this month concerning the doctrine of equitable mootness, a topic that continues to rile bankruptcy courts and generate controversy amongst practitioners and scholars. The Eighth Circuit Court of Appeals recently described…
What the Bankruptcy Venue Reform Act of 2021 Could Mean for Corporate Debtors
On September 23, 2021, United States Senators Elizabeth Warren (D-Mass.) and John Cornyn (R-Texas) introduced the Bankruptcy Venue Reform Act of 2021 (the “Venue Reform Act”), which would tighten the Bankruptcy Code’s venue rules for corporate debtors. A corporate filer would be limited to the district containing…
Judge Spares Ex-CEO of Bankrupt KIT Digital from Additional Jail Time
Federal district court judge Paul Gardephe recently spared Keleil Isaza Tuzman from additional jail time, despite Tuzman’s December 2017 convictions for securities and mail fraud, the latest twist in the long, strange saga of KIT Digital. Tuzman was the founder…
Discharging Student Loan Debt: The ABA Takes a Stand
The House of Delegates for the American Bar Association recently passed Resolution 512 urging Congress to amend the Bankruptcy Code to permit student loans to be discharged in bankruptcy without proving “undue hardship” as is currently required. The resolution was…
Discharging Student Loan Debt – Private Loans Are Not Always Exempt
Student loans are a big issue in the United States. According to the most recent data by the Federal Reserve Bank of New York, there is currently $1.57 trillion in outstanding student debt, up from just $0.26 trillion 17 years…
Paragon Offshore, plc: US Trustee Denied Quarterly Fees Based on Litigation Trust’s Payments to Its Beneficiaries
The U.S. Bankruptcy Court for the District of Delaware recently denied the US Trustee’s motion to compel post-confirmation quarterly fees from Paragon Offshore, plc under 28 U.S.C. § 1930.[1]
The court described the case’s facts as simple: Paragon (and…
Recovering a Fraudulent Transfer? A Slot Machine License Is No Safe Bet.
Philadelphia Entertainment and Development Partners LP, the bankrupt limited partnership that did business as Foxwoods Casino Philadelphia (“Foxwoods”), will not be able to recover the $50 million it paid to the Pennsylvania Gaming Control Board for a slot machine license.…
The Hertz Restructuring: A Rare Win for Public Stockholders
On May 22, 2020, amidst the deepest possible gloom about COVID-19’s impact on travel, the car rental giant, Hertz Global, filed for Chapter 11. According to reporting by Barrons,[1] during the reorganization, Hertz drastically cut the size of its…