Secured Credit Committee

Committees

Post date: Thursday, September 24, 2015

Foreclosure of personal property is a necessary evil for lenders in the commercial default context, and the foreclosure and sale must meet the commercially reasonable standard to withstand later scrutiny by competing creditors and unrequited borrowers.

Post date: Tuesday, July 21, 2015

In In re Alternate Fuels Inc.[1], the Tenth Circuit Court of Appeals describes and applies standards for (1) recharacterizing debt claims as camouflaged equity and (2) equitably subordinating debt claims. In doing so, the court confirmed two things:

Post date: Tuesday, June 30, 2015

What happens if an undersecured creditor makes an election under 11 U.S.C. § 1111(b) but does not otherwise participate in the bankruptcy process? The Fifth Circuit Court of Appeals addressed this question in In re R.L. Adkins Corp. In In re Adkins, the debtor filed a plan of reorganization recognizing the lien of Bakers Hughes Oilfield Operations, Inc. (BHO) on four mineral leases and one well. The total amount due to BHO far exceeded the value of its collateral.

Post date: Tuesday, June 30, 2015

Secured lenders often look to the borrower's or guarantor's rights under insurance policies to improve their collateral position. For example, obtaining a collateral interest in a business interruption insurance policy may protect a lender who is dependent upon the ongoing cash flow of its borrower for debt service. Moreover, obtaining an assignment of an interest in a life insurance policy of the borrower's owner or a principal guarantor protects...

Post date: Wednesday, January 28, 2015
Photo of Gwendolyn J. Godfrey
Gwendolyn J. Godfrey

In the spirit of the New Year, and in the spirit of par-plus-interest recoveries for secured lenders everywhere, we would like to share five New Year’s resolutions culled from recent case law and our experience assisting secured creditors in pre-bankruptcy planning for a defaulted borrower.

Post date: Monday, November 24, 2014

Editor’s Note: The Secured Credit Committee recently hosted a webinar titled “Understanding Make-Whole and No-Call Provisions: Key Takeaways From Recent Decisions.” This webinar discussed recent cases such as AMR Corp. (American Airlines), School Specialty, GMX Resources and Chemtura.

Post date: Monday, November 24, 2014

In a dispute regarding entitlement to proceeds resulting from an auction of livestock in possession of a dairy farmer/debtor,[1] the U.S. Court of Appeals for the Sixth Circuit issued an order on Aug. 14, 2014, in favor of a dairy cattle lessor, despite the secured creditor’s pre-existing security interest in all livestock that is “currently owned or hereafter acquired.” The court found that the dairy cattle leases were not disguised security agreements, as the bankruptcy and district courts in Kentucky had concluded, but were instead true leases.

Post date: Tuesday, August 12, 2014

Courts have long grappled with the question of whether “stripping” an unsecured junior lien is permitted by § 506 of the Bankruptcy Reform Act of 1978 (the Bankruptcy Code).[1] In 1992, in the case of Dewsnup v. Timm, the Supreme Court granted certiorari on the topic, holding that “stripping down” partially unsecured junior liens was not permissible under the plain meaning of the Code.[2] Recently, however, the practical implications of the intersection of § 506(a) and (d) of the Code have been in flux as courts across the country weigh in on the distinction between “stripping down” and “stripping off.”

Post date: Tuesday, August 12, 2014
Photo of Michael Klein
Michael Klein

A recent decision by Bankruptcy Judge Brendan Linehan Shannon of the U.S. Bankruptcy Court for the District of Delaware, In re Optim Energy, LLC, et al.,[1] highlights a shift in Delaware recharacterization jurisprudence. In that case, Walnut Creek Mining Co., debtor Optim Energy’s largest unsecured creditor, sought standing to pursue recharacterization, equitable subordination and fiduciary duty claims on behalf of the estate against the secured lenders, who were also equity-holders, after no committee of unsecured creditors was appointed.

Post date: Monday, August 11, 2014

Editor’s Note: ABI hosted a webinar entitled “The 1111(b) Election: Advanced Mathematics and Strategies” in June. Visit ABI’s Distance Learning site at cle.abi.org to purchase recordings of this webinar.

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Ms. Andrea Chase, Esq.
Co-Chair
Spencer Fane LLP
Kansas City, MO
(816) 292-8279

Mr. James K. Donaldson
Co-Chair
Woods Rogers Vandeventer Black
Richmond, VA
(804) 343-5028

Ms. Alexandria G. Lattner
Communications Manager
Sheppard, Mullin, Richter & Hampton LLP
Costa Mesa, CA
(714) 513-5100

Mr. Eric W. Anderson
Education Director
Parker, Hudson, Rainer & Dobbs LLP
Atlanta, GA
(404) 420-4331

Mr. Ian Rubenstrunk
Education Director
Spencer Fane
Minneapolis, MN
(952) 563-6881

Ms. Shirley Palumbo, Esq.
Membership Relations Director
NextEra Energy Resources
Juno Beach, FL
(561) 310-5028

Ms. Kelli S. Norfleet, Esq.
Newsletter Editor
Haynes and Boone, LLP
Houston, TX
(713) 547-2630

Mr. Evan B. Blum
Special Projects Leader
BDO USA
Woodbridge, NJ
(732) 750-0900

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