An unsecured creditors’ committee is supposed to be representative of the interests of a diverse group of unsecured creditors with an interest in the outcome of a debtor’s reorganization or “fresh start.” Landlords with lease-rejection claims, parties to rejected equipment leases, trade creditors, unsecured bondholders and the Pension Benefit Guaranty Corporation are a few examples.
Add the Western District of New York to those courts holding that in rem tax foreclosures are not presumed to provide reasonably equivalent value to a debtor. In Canandaigua Land Development LLC v. County of Ontario (In re Canandaigua Land Dev. LLC), 521 B.R. 457 (Bankr. W.D.N.Y.
Section 365 of the Bankruptcy Code authorizes a debtor to assume or reject an executory contract. An executory contract that has expired in accordance with its terms is generally not subject to assumption or rejection under the Code.
Recently, the U.S. Bankruptcy Court for the District of Delaware had the opportunity to further clarify the power of § 363 sale processes to cleanse assets and the fragile nature of pension claims in bankruptcy. The court considered and rejected an objection to a § 363 sale free and clear of any successor liability claim where the sale was supported by the debtors, the lenders and the unsecured creditors’ committee, but not the pension trust.
Once disfavored, non-compete agreements — contractual provisions prohibiting employees from competing with their former employers upon the relationship’s termination — have acquired new legitimacy in recent decades.
Editor’s Note: This article is intended for educational purposes only. It is not intended to be legal, accounting or other professional advice. A party should consult with legal counsel when dealing with the issues addressed in this article. The views expressed in this article are solely those of the author and do not necessarily represent the views or opinions of Husch Blackwell LLP.
A trustee for a bankrupt entity or a debtor has the power to bring an action to avoid and recover constructive or actual fraudulent transfers. Section 544(b) of the Bankruptcy Code specifically allows a trustee or debtor to step into the shoes of an actual creditor of the debtor, who could have avoided the transfer outside of bankruptcy using state law. The U.S. Court of Appeals for the Seventh Circuit recently analyzed a debtor’s power to bring a state law fraudulent-transfer action..
A 30-year friendship and business association between Charles Pircher and Wren Alexander ultimately cost one of Alexander’s companies, Wren Alexander Investments, L.L.C. (Wren LLC), its interest in certain real property in Medina County, Texas (Medina Property).
When a bank fails and is liquidated by the Federal Deposit Insurance Corporation (FDIC), and then the bank’s holding company files for bankruptcy, a dispute frequently arises regarding ownership of tax refunds issued to a consolidated group (including the bank and the bank holding company) pursuant to consolidated tax returns.
In line with one of bankruptcy’s vaunted goals, providing debtors with a fresh start, the Bankruptcy Code specifically authorizes debtors to exempt retirement funds held in a compliant retirement account from property of the estate. When done properly, investing funds in a compliant profit-sharing plan can be a powerful financial-planning and asset-protection tool, putting almost unlimited funds out of creditors’ reach.
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