Consider the following situation: A debtor owes you $1 million, and you find out that the debtor has transferred its assets to a third party without receiving reasonably equivalent value and is now unable to pay its debt to you.
Unsecured Trade Creditors Committee
Committees
Consider the following scenario: A financially struggling consumer borrows cash from a friend and deposits the cash into his bank account. He uses this cash to make a purchase at a retail store and later pays his friend back. Subsequently, he files for bankruptcy.
A Federal Rule of Bankruptcy Procedure 2004 examination is commonly referred to as a “fishing expedition”[1] into a debtor’s financial affairs. Debtors, trustees and creditors routinely use Rule 2004 exams to investigate an examinee’s financial affairs with very little interference by bankruptcy courts or discovery rule limitations.
Editor's Note - The Unsecured Trade Creditor's Committee recently hosted a committee call dealing with these same cases. To listen to the recording of this call, click here.
The Bankruptcy Code defines “claim” as a “right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured, or unsecured….”[1] Congress intended the “broadest possible” definition, and that the Code “contemplates
Over the last decade or so, the vast majority of chapter 11 cases not converted to chapter 7 have resulted in sales of the debtors' assets. The sales were accomplished either under § 363 of the Bankruptcy Code or pursuant to a liquidating chapter 11 plan.
In a recent decision arising out of the Lehman case, which has been characterized as the largest and most complex bankruptcy in history and saw professional fees and expenses exceed $1.8 billion, the U.S.
In seeking to protect rights in collateral during the course of a bankruptcy case, secured creditors should be aware of potential fraudulent transfer liability and its far-reaching effect on the ability to protect collateral.
By virtue of loan agreements or a debtor’s acquiescence, a creditor often has varying degrees of influence and control over a debtor and its business. Sometimes, however, a creditor may utilize this control to benefit itself at the expense of other creditors.
In recent years, the practice of bankruptcy claims trading has grown dramatically and now represents a multibillion-dollar-per-year marketplace. However, a recent decision by the U.S. Court of Appeals for the Third Circuit may give pause to prospective claim purchasers.
Co-Chair
Bernstein Shur
Portland, ME
(207) 228-7379
Co-Chair
KEWA Financial Inc.
Lexington, KY
(859) 233-0352
Communications Manager
Davis Wright Tremaine LLP
Seattle, WA
(206) 622-3150
Education Director
Lowenstein Sandler LLP
New York, NY
(646) 414-6886
Newsletter Editor
Cleary Gottlieb
New York, NY
(212) 225-3341
Newsletter Editor
Frost Brown Todd LLP
Cincinnati, OH
(513) 651-6842
Special Projects Leader
B. Riley Advisory Services
Los Angeles, CA
(213) 409-6237