A Hole in the Glove: Why Negotiation Should Trump Solicitation

A Hole in the Glove: Why Negotiation Should Trump Solicitation

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In separate unreported rulings in the Stations Holdings and NII Holdings cases, the U.S. Bankruptcy Court for the District of Delaware, adopting positions championed by the U.S. Trustee, held that votes to accept a reorganization plan cast by a creditor or interest-holder that signed a lock-up agreement after the petition date and prior to approval and circulation of a disclosure statement would be "designated" under §1126 of the Bankruptcy Code, and thus would not be counted for purposes of determining acceptance or rejection of the plan.2

 

While some trumpeted the decisions as ending Delaware's run as a haven for pre-packaged or pre-negotiated plans, or indeed as the venue of choice for chapter 11 cases generally,3 the potentially broader implication of the cases springs from the court's apparent adoption of a broad definition of what constitutes "solicitation" for purposes of §§1125 and 1126. The decisions highlight the long-time debate over when, for debtors and other plan proponents, "negotiation" ends and "solicitation" begins.

This article will first examine the two lines of cases attempting to define "solicit" and "solicitation" under the relevant Code sections—the majority "narrow" definition and the minority "broad" definition that appears to be gaining traction in some recent cases. The article will then explore the recent Delaware cases and their implications for the "solicitation" definition. Last, the article will briefly explore the purpose of the limitations on solicitation and discuss whether a commitment to vote arising out of arm's-length negotiations should be seen as the product of "solicitation" in any case.

The Relevant Code Sections

Section 1125(b) provides, in pertinent part, that "[a]n acceptance or rejection of a plan may not be solicited after the commencement of the case under this title from a holder of a claim or interest with respect to such claim or interest, unless, at the time of or before such solicitation, there is transmitted to such holder the plan or a summary of the plan, and a written disclosure statement approved, after notice and a hearing, by the court as containing adequate information."4 Adequate information is defined inter alia as "information of a kind, and in sufficient detail...that would enable a hypothetical reasonable investor typical of the holders of claims or interests of the relevant class to make an informed judgment about the plan..."5 "Investor typical of holders of claims or interests of the relevant class" is defined to encompass a creditor or interest-holder having (1) a claim or interest of the relevant class, (2) such a relationship with the debtors as the holders of other claims or interests of such class generally have,6 and (3) such ability to obtain such information from sources other than the disclosure statement as holders of claims or interests in such class generally have. A plan proponent may distribute different disclosure statements to different plan classes, with such disclosure statements "differing in amount, detail or kind of information" based on the need of such class for the information in order to make an informed voting decision.7 Under §1126(e) of the Code, on motion and after notice and a hearing, the court may "designate" (not count for voting purposes) "any entity whose acceptance or rejection of such plan...was not solicited or procured in good faith or in accordance with the provisions of this title."8

The Code does not define "solicit" or "solicitation." Congress left it to the courts to define these terms and to apply them in the context of the chapter 11 process.9 Two distinct approaches to defining the terms have emerged from the more than two decades of jurisprudence under the Code.

The Majority View: Solicitation Equals Request for an Official Vote

The majority view takes a narrow view of the definition of "solicitation," a view born out of a concern that pre-plan negotiation between the debtor and creditors, or among creditors, not be chilled. This line of cases limits "solicitation" to a request for a formal vote with respect to a filed plan. This view was first detailed in Judge Clark's opinion in Snyder:

The terms "solicit and solicitation," as used in §1125(b) of the Code, must be interpreted very narrowly to refer only to a specific request for an official vote either accepting or rejecting a plan of reorganization. The terms do not encompass discussions, exchanges of information, negotiations or tentative arrangements that may be made by the various parties in interest in a bankruptcy case which may lead to the development of a disclosure statement or plan of reorganization or information to be included therein. If these activities were prohibited by §1125(b), meaningful creditor participation in chapter 11 cases would cease to exist. It follows that an unauthorized "solicitation" would include a specific request for an official vote for or against a plan of reorganization (a) that is made before dissemination to parties in interest of an approved disclosure statement, or (b) that is made after the dissemination of a disclosure statement and which contains misrepresentations or deliberate falsehoods and misleading statements calculated to deceive parties entitled to vote, or (c) that refers to a plan of reorganization predicated upon arrangements that were arrived at by fraud or that were not adequately disclosed to the court and to parties in interest in the approved disclosure statement.10

This view was also evident in the court's opinion in Texaco,11 when the debtor's settlement agreement with Pennzoil, then a large judgment creditor, was challenged on solicitation grounds:

The fact that Pennzoil has agreed not to "vote for, consent to, support or participate in the formulation of any other plan" does not violate the solicitation requirements under §1125(b) when, in fact, there is no other plan on file which would require a disclosure statement. Section 1125(b) relates to the voting process with respect to filed plans. A disclosure statement must be approved by the court as to any plan before acceptances or rejections of such plan may be solicited. If a plan has not been filed, no disclosure statement is called for under 11 U.S.C. §1125. Therefore, an agreement not to support any other plans in the future does not amount to the solicitation of a rejection of a plan which must be accompanied by a court approved disclosure statement. Such a carte blanche agreement as to future unfiled plans does not offend 11 U.S.C. §1125(b).12

The Texaco court found that Pennzoil's agreement to support the debtor's plan embodying their settlement, and not to propose or support any other plan, "does not amount to a solicitation by Texaco of Pennzoil's consent without a required disclosure statement, in violation of 11 U.S.C. §1125(b), because the stipulation does not constitute a solicitation of Pennzoil's acceptance or rejection of Texaco's plan."13

The Third Circuit's opinion in Century Glove succinctly summarizes the law and policy in this area as viewed by the majority of courts:

We agree with the district court that "solicitation" must be read narrowly. A broad reading of §1125 can seriously inhibit free creditor negotiations. All parties agree that [a creditor] is not barred from honestly negotiating with other creditors about its unfiled plan... The purpose of negotiations between creditors is to reach a compromise over the terms of a tentative plan. The purpose of compromise is to win acceptance for the plan. We find no principled, predictable difference between negotiation and solicitation of future acceptances. We therefore reject any definition of solicitation which might cause creditors to limit their negotiations.14

In fact, according to the court in Kellogg Square Partnership, "the concept of 'solicitation' [is] coeval with the formal polling process."15 Under this view, the term "solicitation" must be very narrowly interpreted to mean only specific requests for an official vote for or against a filed reorganization plan. "The term should not encompass free and honest negotiations among creditors over a tentative plan because such a broad definition would inhibit their meaningful participation in the debtor's reorganization."16

The Minority View

The "minority" view—focused primarily on non-debtor conduct and the protection of the debtor's exclusive right to propose a plan within the exclusivity period—takes a broader view of what constitutes "solicitation." In In re Temple Retirement Community Inc.,17 the court held that a fiduciary distributing a statement of opposition to one plan and support for an alternative plan violated §1125(b). There, a dissenting minority of the members of the bondholders' committee opposed confirmation of the debtor's proposed plan. The dissenters asked the indenture trustee to state on the ballot to be circulated to the bondholder class that they opposed the plan and felt that an alternative type of plan would be more advantageous to all of the bondholders. The indenture trustee asked the court for guidance. The court held: "The bald suggestion of an alternative plan developing in the wings is...impermissible."18

In In re Gilbert,19 the court held that a party "expressing his hope that [another creditor] would vote for debtors' plan...for all practical purposes, made a specific request for [such creditor's] vote[.]"20 The court stated: "the court has little choice but to find that an untimely 'solicitation,' albeit oral, occurred.21 In In re Nautilus of New Mexico Inc.,22 the court held the debtor violated §1125(b) where the debtor's president convened a meeting of creditors and presented various plans, after which votes were taken. The court held "these actions, taken together, amount to a solicitation of acceptance of a plan."23

Another violation of §1125(b) was found in In re Media Central Inc.24 The court held that where the debtor had filed a plan as to which the court had approved a disclosure statement, the debtor violated §1125(b) by soliciting votes on two alternative plans without disclosure statements. The court held:

Although negotiation with creditors and equity security-holders is an integral part of a chapter 11 case, such negotiations cannot be accomplished through solicitation of votes on unfiled plans having no court-approved disclosure statements.25

In In re Aspen Limousine Serv.,26 the court held that a non-debtor plan proponent's letter to the debtor's creditors promoting its competing plan and disseminated after conditional approval of a disclosure statement (in a small business case), but before final approval was improper solicitation. The court distinguished Century Glove, which it characterized as the "high-water mark for parties seeking to solicit rejections of another's plan by comparing it to an unfiled plan of their own," because the letter in Aspen Limousine went to all creditors and not only to the few who requested information.27 The court held that the letter was not part of the negotiation process among creditors, but rather "a deliberate and unabashed attempt to circumvent the confirmation and solicitation procedures established by the bankruptcy court."28

In the Clamp-All case,29 the creditors and would-be plan proponents filed, inter alia, an objection to the debtor's proposed disclosure statement and attached to the objection a full copy of a disclosure statement and alternative plan, and then served the objection and all exhibits upon the entire creditor body. The objection did not contain a request for a vote on the alternative plan or a specific request for a rejection of the debtor's plan. Examining the case law, the court noted that "distinguishing between permissible negotiations and prohibited solicitations has been a difficult task."30 However, the court disagreed with Century Glove, finding that the Third Circuit's "analysis fails to sufficiently recognize Congress's intention to allow a debtor a reasonable time to obtain confirmation of a plan without the threat of a competing plan."31 The court held that §1121 provides the debtor with the exclusive right to propose a plan during its exclusivity period. Thus, presentation of alternatives by third parties during the exclusivity period and prior to the approval and circulation of a court-approved disclosure statement constituted solicitation and was prohibited.32 The court reasoned that creditors who are ignorant of the debtor and its affairs, and that the solicitation procedures were designed to protect, would be disadvantaged if alternatives could be presented prior to distribution of a court-approved disclosure.33

The New Hampshire bankruptcy court took a similar approach in In re CGE Shattuck LLC.34 In that case, the court refused to allow a secured creditor to distribute materials describing how the secured creditor would share the proceeds of liquidation with other creditors if the secured creditor were granted relief from stay, finding that it would be tantamount to creditor circulation of an alternative plan prior to approval and distribution of the debtor's disclosure statement, or any disclosure statement.

Notwithstanding the divergent views, courts considering whether or not settlement discussions between debtors (or trustees) and creditors have crossed the line from negotiation to solicitation have carefully preserved the right to negotiate and have not found impermissible solicitation where it was clear that arm's-length negotiations, in fact, had occurred, even where the creditor agreed to support the debtor's plan and/or not support alternative plans as consideration for the agreed treatment of the creditor's claim under the debtor's to-be-filed plan. In Texaco, the creditor agreed to work with the debtor to confirm the debtor's plan and agreed not to support another plan, yet no "solicitation" was found. Similarly, in Kellogg Square, the debtor and a creditor agreed on treatment of the creditor's claim and, as part of the global settlement agreement, the creditor agreed to vote for the debtor's to-be-filed plan. The court found neither a solicitation of a vote nor an acceptance of the plan. As the court stated:

Limiting the bar of §1125(b) in this fashion avoids a chill on debtors' post-petition negotiations with their creditors, one which otherwise might prove devastating to the reorganization process. Promoting a consensual process in reorganization, in turn, will have the broader benefit of preserving the resources of both debtors and creditors; it will encourage the making of arrangements earlier in the case, it will reduce the likelihood that the plan and disclosure statement will undergo several redrafts after an initial hearing under §1125(b), and it should thereby reduce the burden on the estate of administrative-expense claims that are incurred in connection with such redrafting.
As a matter of these basic principles, then, the debtor's negotiations with District Energy did not constitute "solicitation" within the contemplation of §1125. The debtor, then, did not violate that section by obtaining District Energy's support for its plan in the way it did, and as early as it did.35

Recently, in Zentek GBV Fund,36 the court found that a chapter 11 trustee's settlement agreement with the IRS about plan treatment, under which the IRS voted in favor of the trustee's plan, was not improper solicitation, and thus refused to designate the vote of the IRS under §1126.

The Delaware Cases

The relevant pleadings indicate that Stations Holdings and NII Holdings involved similar "lock-up and voting agreements."37 In both cases, the agreements were the product of extensive pre-petition negotiations between the debtors and the creditor and interest-holder parties to the agreements. All of the parties to the agreements were sophisticated entities, represented by counsel and with apparently unlimited access to due diligence information regarding the debtors. The agreements attached term sheets with respect to the proposed debtor plans, and the parties to the agreements agreed to vote for a plan that included the provisions on the term sheets. If the plan as filed deviated from the term sheet in any material respect, the other party was not bound to support it. The agreements specifically provided that no solicitation of votes had occurred, and that solicitation would occur only following distribution of the court-approved disclosure statement. If such distribution did not occur, the parties were free to vote for other alternatives. The agreements contained provisions allowing for a specific performance remedy, but such remedy, and the enforcement of the agreements generally, was made subject to §§1125 and 1126 of the Bankruptcy Code. In both cases, it was uncontested that almost all, if not all, of the negotiations for the agreements had occurred prior to the filing of the petitions. In the NII Holdings case, the agreements also contained "fiduciary outs" and provisions releasing the parties from any obligations in the event of a material adverse change in the debtor's affairs. In short, the agreements were remarkably similar, in content and effect, to the agreements in Texaco and Kellogg Square.

Focusing on the presence of the specific performance remedy and the debtor's apparent ability to enforce the voting agreements by injunction (and ignoring the conditions to performance), the U.S. Trustee argued that—as to lock-up agreements executed post-petition—improper solicitation of votes had resulted from the negotiations for the agreements and as a consequence of the terms of the agreements.38 The U.S. Trustee sought to designate the votes of the parties to the lock-up agreements under §1126, despite the fact that the plans had been accepted by the requisite majorities, even if the votes of the "locked-up parties" were not counted. The debtors and several other parties, including parties to the agreements and committees, opposed the relief sought by the U.S. Trustee, citing, inter alia, Century Glove, Texaco and Kellogg Square. None of the parties to the lock-up agreements was seeking to be freed from the agreements.

Remarkably, in each case the court granted the U.S. Trustee's motion to designate the parties to the lock-up agreements signed post-petition, thus not counting their votes in favor of the plans. The court's order in each case was a simple, one-page order designating the parties, but containing no reasoning or rationale.39 One has to assume that the court found the U.S. Trustee's arguments persuasive, and that the court rejected Texaco and Kellogg Square. The unmistakable implication is that post-petition negotiations prior to circulation of the court-approved disclosure statement and that involve a debtor request of the creditor or interest-holder to support or vote for a future plan to be filed that includes the agreed-upon treatment of the creditor's claims constitute, or at least involve—in the eyes of this court—improper solicitation. In particular, nothing was said about the seemingly controlling language in Century Glove to the effect that there is no "principled...difference between negotiation and solicitation of future acceptances."

Why Limit Solicitation?

What is the purpose of a definition of "solicitation" that would sweep within its scope negotiations between and among sophisticated parties, represented by counsel, with access to all information that they require? An examination of the apparent purpose of the limits on vote solicitation prior to court-approved disclosure suggests that such a definition is unnecessarily overbroad and will only serve, as Snyder, Century Glove and Texaco warn, to chill important negotiations between the debtor and key creditor constituencies precedent to full development and filing of a plan.

Commentators agree that the rationale behind the requirement of SEC-approved disclosure in connection with plans under old chapter X was protection of the unsophisticated investor without access to information regarding the debtor's affairs.40 When old chapters X and XI were merged to create the new chapter 11, the disclosure concept was carried over, but the SEC was removed from the process in favor of more flexible court-approved disclosure in the "one-size-fits-all" chapter 11 model.41 However, even the courts taking a broader definition of "solicitation" acknowledge that the limits on pre-disclosure statement solicitation contained in the Code were designed to protect those who are uninformed as to the debtor's affairs. As the court in Rook Broadcasting reasoned:

The Bankruptcy Code's requirement of court approval of a disclosure statement, combined with Rule 3017's restrictions on dissemination of an unapproved disclosure statement, clearly contemplates some creditors' need to be protected against misinformation. Creditors who are not knowledgeable or informed with regard to the debtors' affairs will not be presented with information regarding the debtors and the proposed plan until the court has determined the disclosure statement contains information adequate for the creditor to make an informed choice. Creditors who are knowledgeable with regard to the debtor and its affairs presumably will not be misled by the disclosure statement because of their own independent sources of information. It is these informed creditors who are interested in obtaining copies of proposed disclosure statements, and who, through the process of objection, will shape the final disclosure statement for the benefit of those creditors who do not have such information.
Permitting a plan proponent to distribute proposed disclosure statements taints the voting process. Those creditors who are ignorant of the debtor and its affairs, the ones for whose protection §1125 requires court approval of the disclosure statement, would instead be presented with numerous documents containing inconsistencies, omissions and misleading or incorrect statements. The debtors and the court would be forced to attempt to "chase down" these problems, with little real hope of undoing the damage.42

The Clamp-All court's concerns were directed at the same uninformed creditors. Indeed, most of the cases in the "minority" camp involved unilateral dissemination of materials to the entire creditor body. The Code's use of the "hypothetical investor" concept is consistent with this purpose, as is the ability to vary the amount of information on a class-by-class basis. Of course, in negotiations between the debtor and a sophisticated player in the chapter 11 process, a real investor is there, demanding such information as such investor requires. This judgment about what a hypothetical, typical investor might need is not relevant or required. The results in Stations Holding and NII Holding have the effect of protecting parties who do not need protection from their own informed choices. Indeed, the fact that any creditor can request a draft disclosure statement under Rule 3017 and receive one suggests an awareness that involved, informed parties may not need this protection.

Negotiation Trumps Solicitation

None of the purposes evidenced by §§1125 and 1126 is furthered by a doctrine that defines "solicitation" to include negotiating for plan support in the context of post-petition, pre-plan and disclosure statement negotiations between the debtor and represented, sophisticated creditors and interest-holders, where such parties have the ability to demand and receive due diligence from the debtor and can, at any point in time that suits them, terminate negotiations. In the course of such pre-plan negotiations, there is nothing untoward or contrary to the policies embodied in §§1125 and 1126 about the debtor receiving, as one aspect of the consideration for the agreement on treatment of the claims, a commitment to support the plan and avoid supporting alternatives. It is through a succession of such negotiations that plans are built. Better still to have the agreement of support of record, in an agreement, as opposed to a "wink and a nod." If the debtor's disclosure of information to the other party was fraudulent or materially misleading, principles of contract law and remedies at equity will permit the creditor to rescind the voting agreement, and the court will be quick to fashion an appropriate remedy. As the Kellogg Square court noted, "had the final, court-approved disclosure statement revealed information that materially bore on District Energy's interests, and had the debtor previously failed to disclose that information to District Energy, District Energy would have had a right under general, non-bankruptcy law to repudiate the agreement via rescission, and then to cast a rejecting ballot."43 There is no reason to label such negotiation "solicitation" and to invoke §§1125 and 1126. To do so simply inhibits pre-plan negotiation without advancing the policies embodied in those sections.

Requesting plan support—including a commitment to vote for a plan that conforms to the deal and to avoid support of alternatives—in the context of such arm's-length negotiations between sophisticated parties should be seen as simply outside the definition of solicitation, as it was in Texaco and Kellogg Square. The results in Stations Holding and NII Holdings (and the definition of "solicitation" they imply) do not further any legitimate policy found in §§1125 and 1126 and will only serve to chill the very kinds of negotiations that lead to consensual plans in the best interests of creditors and other interests of the estate.


Footnotes

1 Board-certified in business bankruptcy by the American Board of Certification. Return to article

2 See, generally, DeFrancheschi, Daniel J., "Delaware Bankruptcy Court Announces Bright-line Rule for Use of Lock-up Agreements in Chapter 11 Cases," 22-Feb. Am. Bankr. Inst. J. 16 (2003). Return to article

3 See Flaschen, Evan D., "Goodbye, Wilmington," The Deal.com, Jan. 14, 2003. Return to article

4 11 U.S.C. §1125(b). Return to article

5 11 U.S.C. §1125(a)(1) (emphasis supplied). Return to article

6 11 U.S.C. §1125(a)(2). Return to article

7 11 U.S.C. §1125(c). Return to article

8 11 U.S.C. §1126(e). Return to article

9 See, e.g., In re Clamp-All Corp., 233 B.R. 198, 204-05 (Bankr. D. Mass. 1999); In re Snyder, 51 B.R. 432, 436 (Bankr. D. Utah 1985). Return to article

10 Snyder, 51 B.R. at 437. Return to article

11 Trans World Airlines Inc. v. Texaco Inc. (In re Texaco Inc.), 81 B.R. 813 (Bankr. S.D.N.Y. 1988). Return to article

12 Id. at 815-816 (emphasis supplied). Return to article

13 Id. at 815. Return to article

14 Century Glove Inc. v. First American Bank of New York (In re Century Glove Inc.), 860 F.2d 94, 101-02 (3d Cir. 1988) (emphasis supplied). Return to article

15 In re Kellogg Square Partnership, 160 B.R. 336, 340 (Bankr. D. Minn. 1993). Return to article

16 In re Gilbert, 104 B.R. 206, 214 (Bankr. W.D. Mo. 1989). See, also, In re Pleasant Hill Partners, 163 B.R. 388, 391 (Bankr. N.D. Ga. 1994) (§1125 solicitation "construed very narrowly"); In re Dow Corning Corp., 227 B.R. 111, 117-18 (Bankr. Fed. Mich. 1998) (solicitation occurs only when a party in interest makes a specific request for an official vote). Return to article

17 80 B.R. 367, 369-70 (Bankr. W.D. Tex. 1987). Return to article

18 Id. at 369. Return to article

19 104 B.R. 206 (Bankr. W.D. Mo. 1989). Return to article

20 Id. at 214-15. Return to article

21 Id. Return to article

22 83 B.R. 784 (Bankr. D. N.M. 1988). Return to article

23 Id. at 791. Return to article

24 89 B.R. 685, 690 (E.D. Tenn. 1988). Return to article

25 Id. at 690; see, also, In re D.M. Christian Co., 7 B.R. 561, 562-63 (Bankr. N.D. W.Va. 1980) (requiring "strict compliance with 11 U.S.C. §1125(b)" even if time-consuming). Return to article

26 193 B.R. 325 (D. Colo. 1996). Return to article

27 Id. at 348. Return to article

28 Id. at 348-49 (citing In re Apex Oil Co., 111 B.R. 245, 249 (Bankr. E.D. Pa. 1990), and In re Gulph Woods Corp., 83 B.R. 339 (Bankr. E.D. Pa. 1988)). Return to article

29 In re Clamp-All Corp., 233 B.R. 198 (Bankr. D. Mass. 1999). Return to article

30 Id. at 205. Return to article

31 Id. at 207-08. Return to article

32 Id. at 208. Return to article

33 Id. at 208-09. See, also, In re Rook Broadcasting of Idaho, 154 B.R. 970, 976 (Bankr. D. Idaho 1993). Return to article

34 254 B.R. 5 (Bankr. D. N.H. 2000). Return to article

35 160 B.R. at 340. Return to article

36 Zentek GPV Fund IV LLC v. Vesper, 2001 WL 104 2217 (6th Cir. 2001). Return to article

37 In In re Stations Holdings Co., Case No. 02-10882(MFW) (Bankr. D. Del.), see (a) Motion of the U.S. Trustee Pursuant to §§1125(b) and 1126(d) and (e) of the Bankruptcy Code to Designate All Persons Who Executed Post-petition Lock-up Agreements and to Direct That Their Ballots Not Be Counted, and/or for Sanctions or Other Relief dated Sept. 5, 2002 (UST Motion-Stations); (b) Objection of the Official Committee of Unsecured Creditors of Stations Holding Inc. to the [UST Motion-Stations] and Statement in Support of Confirmation of the Plan dated Sept. 23, 2002; (c) Debtor's Objection to U.S. Trustee's Motion Seeking Designation of Votes dated Sept. 20, 2002; and (d) Response of Gray Television Inc. to [UST Motion-Stations] dated Sept. 23, 2002.

In NII Holdings Inc., Case No. 02-11505 (MFW) (Bankr. D. Del), see (a) Motion of the Acting U.S. Trustee Pursuant to 11 U.S.C. §§1125(b), 1126(b), 1126(d) and 1126(e) for an Order (1) Designating Persons Who Executed Lock-up Agreements, (2) Directing that the Ballots Cast by Such Persons Not Be Counted, (3) Imposing Sanctions, and/or (4) Granting Other Relief dated Sept. 30, 2002 (UST Motion-NII); (b) Objection of Debtors and Debtors-in-possession to [UST Motion-NII] dated Oct. 17, 2002; (c) Joinder of Nextel Communications Inc. to Objection of Debtor and Debtors-in-possession to [UST Motion-NII]; and (d) Objection of Ad Hoc Bondholder Committee to Motion of the Acting U.S. Trustee to Designate Certain Creditor Votes and Joinder of Ad Hoc Bondholder Committee in Objection of Debtors-in-possession to Same dated Oct. 17, 2002. Return to article

38 UST Motion-Stations at ¶¶18-19; UST Motion-NII at ¶¶13, 19-20. Return to article

39 In re Stations Holding Corp., Case No. 02-10882 (MFW), Order Granting [UST Motion-Stations] dated Sept. 30, 2002; In re NII Holdings Inc., Case No. 02-11505 (MFW), Order dated Oct. 25, 2002. The orders are referred to in In re Stations Holding Co., 2002 WL 31947022 (Bankr. D. Del. 2002) at *3 and In re NII Holding Inc., 288 B.R. 356, 362 (Bankr. D. Del. 2002). Return to article

40 See Montgomery, Claude D. et al., "Solicitation Under §1125 of the Bankruptcy Code: Century Glove and the First Amendment, 23 Seton Hall Law Review 1570, 1571-75 (1993). Return to article

41 Id. at 1577-78. Return to article

42 Rook Broadcasting, 154 B.R. at 976. Return to article

43 160 B.R. at 340. Return to article

Bankruptcy Code: 
Journal Date: 
Sunday, June 1, 2003