Tabla de contenidos para June 2023 en ABI Journal

Christina Sanfelippo is an associate with Cozen O’Connor in Chicago and co-chair of ABI’s Young and New Members Committee. Aaron Kaufman is a partner with Gray Reed & McGraw LLP in Dallas. Bradley Pack is a shareholder with Engelman Berger, PC in Phoenix. Second Circuit Limits Who May Assert a Cure Claim Under § 365‌(b)‌(1)‌(A) The Second Circuit recently held that a creditor who seeks to assert a “cure claim” under § 365‌(b)‌(1)‌(A) of the Bankruptcy Code must have a contractual right to payment under the executory contract or unexpired lease in question. Therefore, a creditor who seeks payment from a debtor under one contract but asserts an uncured default arising from a separate contract in which the creditor has no contractual rights cannot assert a “cure claim” under §…

“The road is long, with many a winding turn. That leads us to who knows where? Who knows where?”—The Hollys, “He Ain’t Heavy, He’s My Brother” (1969) Thomas Salerno is a partner with Stinson LLP in Phoenix and a past ABI Vice President-Development. I have to confess that 40 years of law practice has been a real buzzkill when I watch movies now that involve the civil legal system. The climactic end scene is usually the underdog defeating the immoral corporate giant as the jury verdict is announced, scowling big firm attorneys vowing to appeal, tears of relief and gratitude flowing freely, fade to black, end credits. It’s great cinema, and leaves the audience with the sense of closure (and justice). However, we all know real life is just not…

Edward Boltz is the managing partner with the Law Offices of John T. Orcutt, PC in Durham, N.C. Lori Patton is a consumer attorney in Altamonte Springs, Fla., and serves on the chapter 7 trustee panel in the Middle District of Florida (Orlando division). The consumer bankruptcy exemption scheme has always been complicated. Even when the whole nation operated under 11 U.S.C. § 522, each state had the option to decline the use of federal exemptions and use its own or allow debtors to choose between state and federal. In some jurisdictions, debtors can choose between state or federal exemptions, and some even have different state-level options to choose from. Which law would be used depended on the location of the petition filing. Congress complicated things further with the Bankruptcy…

Jeffrey Kwong is a partner with Levene, Neale, Bender, Yoo & Golubchik LLP in Los Angeles and a 2021 ABI “40 Under 40” honoree. For decades, judges, academics, commentators and practitioners have debated and disagreed over various issues concerning the calculation and payment of a landlord’s allowed claim in bankruptcy.1 One such issue is whether the “rent approach” or “time approach” should be used in the “15 percent calculation” for a landlord’s capped claim for “damages resulting from termination” under § 502‌(b)‌(6) of the Bankruptcy Code after a real property lease has been terminated or rejected. On the one hand, debtors and other proponents of the time approach primarily argue that the statute’s plain language shows that the 15 percent calculation refers to the amount of time remaining under the…

Vincent Roldan is a partner with Mandelbaum Barrett PC in Roseland, N.J. Discharge is said to be the “holy grail” of a corporate reorganization: “It is the sine qua non without which there can be no fresh start for the ‘honest but unfortunate’ debtor.”1 Although a chapter 11 plan will discharge most types of debts, certain debts are deemed ineligible for discharge for public policy reasons. These debts are excepted from discharge under § 523 of the Bankruptcy Code. Until recently, chapter 11 was too cost-prohibitive for small businesses, but Congress enacted subchapter V in the Small Business Reorganization Act in 2019 as a streamlined, less expensive alternative to traditional chapter 11 cases. The bankruptcy filing statistics show that small businesses have not only been using the new subchapter V…

Michael Herz is a partner with Fox Rothschild LLP in Morristown, N.J., and part of the firm’s Financial Restructuring and Bankruptcy Group. Stephanie Slater is an associate in the firm’s Wilmington, Del., office. Section 1141‌(b) of Bankruptcy Code explains that “except as otherwise provided in the plan or the order confirming the plan, the confirmation of a plan vests all of the property of the estate in the debtor.”1 Chapter 11 plans may provide a mechanism for the pursuit of any claims or interests by a debtor, trustee or “representative of the estate.”2 If the plan proponent so chooses, a “representative of the estate” may be designated to pursue claims or interests on behalf of the estate. These estate representatives may include — but are not limited to — litigation…

February (partial list) Nicklos T. Frei KTBS Law LLP Los Angeles A. Garrett Silver, Voit & Garrett Mobile, Ala. Amanda Gazzo St. John’s University School of Law Commack, N.Y. Elizabeth Gomiela St. John’s University School of Law Rockville Centre, N.Y. Diarmuid F. Gorham U.S. Department of Justice New Freedom, Pa. Pietro Grandi The Brattle Group Boston Annmarie Gruick St. John’s University School of Law Nesconset, N.Y. Rujia Guo Georgetown University Law Center Washington, D.C. Sanad Hamad The Law Offices of Robert M. Geller Tampa, Fla. Gabriella Hansen St. John’s University School of Law Oakdale, N.Y. Debora Hoehne Goodwin Procter LLP New York Jinhe Hu Davis Polk & Wardwell LLP New York Samuel G. Husman Boston College Law School Newton, Mass. Mehrnoosh Karimi Andu IHRDC Houston Hamid Khanbhai Campbells LLP George…

Edward Neiger is a co-managing partner with ASK LLP in New York. Kara Casteel and Jay Reding are partners in the firm’s St. Paul, Minn., office. Turmoil in the cryptocurrency industry has led to a flurry of bankruptcies, which will inevitably lead to avoidance litigation, including preference claims. The intersection of cryptoassets and preference law involves many uncharted territories. This article explores some of the key issues involved in bringing or defending crypto-preference claims. While this is not an exhaustive list, an early understanding of these issues will help both plaintiffs and defendants be better prepared for the major potential disputes in crypto-preference litigation. Because of the plethora of cryptoassets, from traditional coins like Bitcoin to tokens to non-fungible tokens (also called “NFTs”), easy answers are elusive. However, asking the…

David Bowsher is a partner and Gabe Quistorff is an attorney with Balch & Bingham LLP in Birmingham, Ala. When talking about a sale of the debtor’s property pursuant to 11 U.S.C. § 363, several things may come to mind — maybe a public auction of a tangible piece of property in the debtor’s bankruptcy estate, such as equipment or real estate, or maybe a sale of the debtor’s business as a going concern. However, when assessing a chapter 11 debtor’s restructuring options, debtor’s counsel can and should take a broad view of § 363 beyond its more traditional applications. Private sales and sales of property free and clear of nondebtor interests other than in rem liens offer two less common uses for § 363. Between § 363 and sales…

Jennifer Lyday is a partner with Waldrep Wall Babcock & Bailey PLLC and a 2021 ABI “40 Under 40” honoree. Joshua Plummer is a thirdyear law student at Wake Forest University School of Law. They are both based in Winston-Salem, N.C. In February 2020, Congress codified the Small Business Reorganization Act of 2019 (SBRA) as subchapter V of chapter 11 of the Bankruptcy Code.1 In doing so, Congress established a relative safe haven for eligible small businesses that provides a more streamlined and less costly chapter 11 relief process.2 However, in its haste to “permit qualifying small business debtors to file [for] bankruptcy in a timely, cost-effective manner,”3 Congress seemingly failed to amend § 348‌(b) — a critical Code section that grants timeline extensions in most instances when cases are…

Nancy Peterman is chair of Greenberg Traurig LLP’s Chicago Restructuring and Bankruptcy Practice and a past member of ABI’s Board of Directors. Nicholas Ballen and Danny Duerdoth are associates in the same office. Official committees of unsecured creditors in chapter 11 cases typically consist of the top five to seven general unsecured creditors willing to serve on the committee. The committee’s role is to represent the interests of all general unsecured creditors. It is one of the main participants in the case and serves as a check on debtors, secured lenders and other parties-in-interest throughout the case, from first-day motions to confirmation and beyond. For example, the committee acts to protect the interests of general unsecured creditors with respect to, inter alia, debtor-in-possession (DIP) financing terms and plan terms, and…

Carlyn Taylor is a senior managing director with FTI Consulting, Inc. in Denver and global co-leader of the firm’s Corporate Finance and Restructuring Practice. John Yozzo is a managing director in the firm’s New York office. Long before the Orwellian-sounding phrase “alternative facts”2 entered our political discourse as a means by which flimsy arguments could try to claim some credibility, there was adjusted EBITDA (earnings before interest, taxes, depreciation and amortization). Despite its detractors and well-documented inadequacies as a shorthand proxy for cash flow generated (or used) by business activities, EBITDA has been a widely used metric by companies, analysts and investors for several decades, and its popular offshoot, adjusted EBITDA, takes the concept a bit further into the wilderness. Much has been written on this topic in recent years,…

Two attorneys with Miller, Canfield, Paddock and Stone, PLC in Detroit have been awarded 2022 Thought Leadership Awards by the National Law Review. Ron A. Spinner has been an ABI member since 2009. Marc N. Swanson has been an ABI member since 2008. Andrea Chase of Spencer Fane LLP (Kansas City, Mo.) has been honored by Missouri Lawyers Weekly as an “Up & Coming” attorney. She has been an ABI member since 2012, is co-chair of ABI’s Secured Credit Committee and is a 2021 ABI “40 Under 40” honoree. Nathan G. Kanute of Snell & Wilmer, LLP (Reno, Nev.) has been elected to the PBS Reno Board of Trustees. He has been an ABI member since 2008. Kristin B. Mayhew has joined Pullman & Comley, LLC as a member of…

Soneet R. Kapila of KapilaMukamal, LLP (Fort Lauderdale, Fla.) has been selected by the ABI Board of Directors to be President for a one-year term. An ABI member since 1994, Kapila was recently ABI’s Treasurer and a co-chair of ABI’s Southeast Bankruptcy Workshop, and he is a contributing author to ABI’s Fraud and Forensics: Piercing Through the Deception in a Commercial Fraud Case, a regular speaker at ABI events, and a contributor to the ABI Anthony H.N. Schnelling Endowment Fund. Kapila is a founding partner of KapilaMukamal, LLP (formerly Kapila & Co.). For nearly 30 years, he has concentrated his efforts in the areas of insolvency, fiduciary and creditors’ rights matters. He represents other bankruptcy trustees, debtors, and both secured and unsecured creditors in and out of bankruptcy court. Kapila…

Congressional Hearings on SVB’s Collapse Center on Bank Executives, Regulators The Senate Banking Committee held hearings in mid-May to continue examining the failures of Silicon Valley Bank (SVB) and Signature Bank. The May 16 hearing, “Examining the Failures of Silicon Valley Bank and Signature Bank,” featured former bank executives testifying for the first time before the committee since the banks collapsed in early March. Witnesses included Gregory W. Becker, former SVB CEO; Scott A. Shay, former chairman and co-founder of Signature Bank; and Eric R. Howell, former president of Signature Bank. Becker, who was fired from SVB shortly after its March failure, was a lightning rod for senators on both sides of the aisle, as this was the first time that he had spoken since the bank’s failure. While Becker…

Max Brauer is an assistant attorney general with the Maryland Office of the Attorney General, Securities Division, in Baltimore. From time to time, a multistate coalition will be present in bankruptcies, particularly corporate bankruptcies. Multistate coalitions often arise when states have a common interest in the bankruptcy, such as similar claims against the debtor. For example, several states might have similar claims arising from their state regulatory powers, particularly claims relating to environmental law or consumer protection. Multistate work is a niche practice in state attorneys general offices and also among private firms. Due to the niche nature of multistate work, some counsel might not know how to work effectively across the aisle with these coalitions in a professional and efficient manner. This article provides some tips for practitioners when…

Hon. Rebecca Connelly is a judge for the U.S. Bankruptcy Court of the Western District of Virginia in Harrisonburg, previously having served as a standing chapter 13 trustee and chapter 12 trustee. She is also chair of the Judicial Conference Advisory Committee on the Federal Rules of Bankruptcy Procedure, as well as an adjunct professor at Washington & Lee University School of Law and a conferee in the National Bankruptcy Conference. William Shakespeare’s prose offers more than entertainment. His famous lines are also helpful as practice advice. This article highlights a handful of famous quips as tools to improve our professionalism. “The first thing we do, let’s kill all the lawyers.” This line1 is often met with laughs and applause, reminding us of just how unpopular our profession is. Although…

Arthur Rosenberg is an attorney with Holland & Knight LLP in New York. Emily Rothkin is an attorney in the firm’s Boston office. Since its introduction in 2005, chapter 15 of the U.S. Bankruptcy Code has served as an extremely valuable tool for individuals and entities in foreign bankruptcy, insolvency or reorganization proceedings. Chapter 15 allows the representatives of foreign bankruptcy cases to access U.S. bankruptcy courts to conduct an “ancillary proceeding” in the U.S. and utilize the power of its courts. Gaining access to chapter 15 can allow the representatives of a non-U.S. bankrupt person or entity to deal with assets, creditors, agreements and counterparties located in the U.S., and gives them the ability to apply U.S. legal procedures such as discovery under the Federal Rules of Civil Procedure,…

Mike Paek is the chief deputy clerk for the U.S. Bankruptcy Court for the Southern District of New York. He has been an adjunct professor of business bankruptcy law at Fordham University School of Law, and is a 2021 ABI “40 Under 40” honoree. Attorneys who have litigated bankruptcy appeals know that an appellant must satisfy the “person-aggrieved” test to have appellate standing. This standard generally requires that the appellant have a direct pecuniary interest in the bankruptcy order being appealed. Despite its longstanding adoption, the continued viability of the person-aggrieved standard was recently put into serious question by the Sixth Circuit in In re Schubert.1 Writing for a two-judge majority, Hon. Amul Thapar of the U.S. Court of Appeals for the Sixth Circuit observed that the standard has “almost…

Attend a Virtual Happy Hour This Month with ABI’s New President Join us at 5 p.m. EDT June 14 to kick off summer with a Virtual Happy Hour featuring ABI President Soneet R. Kapila of KapilaMukamal, LLP (Fort Lauderdale, Fla.), who began his term in April during the Annual Spring Meeting. Bringing together practitioners from all over the world, our complimentary virtual happy hours allow practitioners to stay connected. Please make plans to join us for great networking by signing up today at abi.org/rsvp. Get Noticed by Becoming an ABI Journal Associate or Coordinating Editor Do you look forward to reading the ABI Journal every month and want to get more involved? ABI welcomes members to write for the Journal, but you can also take your involvement a step further:…