Rochelle's Daily Wire

Congress decided to deviate from standard priorities by providing in Section 724 that unsecured domestic support obligations come ahead of tax liens.

The bankruptcy court in Delaware sided with four circuits by directing the U.S. Trustee to give refunds for overpayment of fees that were not uniform throughout the country.

With four circuits in agreement, the Supreme Court isn’t likely to grant cert to rule on whether chapter 11 debtors are entitled to refunds for overpayment of U.S. Trustees fees that were held unconstitutional in Siegel.

The Fifth Circuit avoided deciding whether approval of breakup fees is judged by the more lenient Section 363(b) or the more exacting standard for administrative expenses under Section 503(b).

The government has filed a petition for certiorari raising the question of whether refunds are the proper remedy following the Supreme Court’s Siegel decision finding that the 2018 increase in U.S. Trustee fees was unconstitutional.

All three courts to confront the question have now ordered the government to refund overpayments of U.S. Trustee fees.

Appealing an order appointing a chapter 11 trustee does not entitle the DIP’s counsel to compensation pending appeal, Judge Klein says.

The Second Circuit essentially reissued its original decision from last year by again requiring the U.S. Trustee to refund the overpayment of unconstitutional fees.

The Second Circuit adapts Rash to value the lender’s collateral in chapter 11 where there was a going-concern sale.

Judge Sarah Hall declined to expand the exception in Reading for post-petition claims to have administrative status.