The Caesars Judge is Right on Stay Termination

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Caesars (photo by Marilyn Swanson)

Judge Goldgar is right.

Bankruptcy Judge A. Benjamin Goldgar, of Chicago, received lots of grief in recent days over the resignation of the Caesars mediator.  The resignation letter focuses on “atypical” language on mediation confidentiality that Judge Goldgar used to support his order terminating a stay of legal action against the Caesars parent company.  Here’s an article on the resignation.

But subsequent developments show that Judge Goldgar was right on the merits of the stay termination.

Judge Goldgar found the stay’s continuing existence to be an impediment to settlement–indicating that the stay’s termination would apply pressure toward achieving a settlement.

So, he terminated the stay (and used the offending mediation confidentiality language as part of the rationale for doing so).  Judge Goldgar is now proven to be correct that stay termination would improve settlement possibilities:

–The Wall Street Journal and other news outlets are reporting that Caesars Entertainment Corp. “has reached a deal to resolve the long-running battle over the $18 billion restructuring of the casino company’s main operating unit.”

Judge Goldgar will, undoubtedly, tip-toe around any future discussions or actions relating to mediation.

On the other hand . . .

Still . . . the Caesars mediator deserves kudos for taking a principled stand on an important mediation issue.

The mediation confidentiality flap in Chicago would be less significant, but for the fact that the Bankruptcy Court there recently revoked its local rules on mediation.

–Such revocation took the Bankruptcy Court in Chicago on an excursion back into the jurisprudence of the pre-1980s — before mediation came into existence as a common dispute resolution tool.

–Hopefully, one day, that Court will make its way back into the modern age by re-establishing some mediation rules that include confidentiality requirements.

 

2 thoughts on “The Caesars Judge is Right on Stay Termination”

  1. Don,
    Sometimes there are principled people on both sides of a dispute.
    When I was a visiting bankruptcy Judge in DC. I lifted the stay in a legal partnership case when there was no progress toward an obvious settlement with a comment that made the newspapers.
    I paraphrase because the case was over 25 years ago. “ I am lifting the stay. Under Maryland law and the case law of this matter, after the stay is lifted, the creditors will be removing the Mercedes Benz’s from the driveways and collecting the private school payments. I am sure the spouses who are not in bankruptcy will weigh in on this case to their partners. “ I think I was more eloquent at the time. Two weeks later the trustee in the case announced a settlement with the partners. My view is the Chicago judge focused the parties on what they needed to do.

    I enjoyed reading your articles and comments. Keep them coming!

    Frank Conrad

    Like

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