3rd Circuit

Sovereign Immunity Prevailed Because a Slot Machine License Isn’t ‘Property’

In Pennsylvania, a gaming license isn’t ‘property.’ It’s a revocable license that can’t be owned.

Judge Sontchi Cuts Off U.S. Trustee Fees on Confirmation of a Chapter 11 Plan

Closing a chapter 11 case after confirmation to avoid U.S. Trustee fees won’t be necessary if the ruling by Judge Sontchi holds up.

Increasing Debtor’s Profit or Revenue Isn’t Required to Establish an ‘Admin’ Claim

An administrative creditor isn’t a ‘guarantor’ of the success of the project, Delaware’s Bankruptcy Judge Goldblatt says.

Federal Common Law Doesn’t Define a Business Trust Eligible for Chapter 11

Recent Supreme Court authority supports the conclusion by Delaware’s Judge Sontchi that law from the jurisdiction of incorporation, not federal common law, determines what is or isn’t a business trust eligible for chapter 11.

Third Circuit Finds Broad Waiver of Sovereign Immunity for Suits Augmenting the Estate

Circuit Judge Ambro generously interprets Katz to mean that ratification of the Constitution waived state sovereign immunity broadly for suits to augment a bankrupt estate.

Curing Defaults Isn’t Always Required Before Selling a Contract, Third Circuit Says

The ‘Countryman’ definition of an executory contract allows a debtor sell a contract without curing a default if the non-debtor counterparty has no further material, unperformed obligations.

Jevic Rises from the Dead to Bar Claims Brought Originally by the Creditors’ Committee

Not having challenged pre-petition liens on time, a chapter 7 trustee was barred from taking over an adversary proceeding initiated by a now-dissolved chapter 11 creditors’ committee.

Faulty Pleading Resulted in Dismissal of a Suit by an ‘Unknown’ Creditor

Third Circuit dicta suggests that failure to create a trust is constitutionally deficient and won’t discharge claims of ‘unknown’ creditors in a chapter 11 plan.

No Disqualification When Lawyers at Adversary Firms Were Dating

Delaware bankruptcy judge trusts that dating lawyers at adversary firms didn’t disclose client confidences.

Pennsylvania District Judge Holds that FLSA Suit Is Not Halted by Automatic Stay

Splitting with the Sixth Circuit, Pittsburgh district judge rules that a FLSA suit falls within the ‘police and regulatory’ exception to the automatic stay.