On Bankruptcy and Mediation
Facilitating fun: a primary duty (Photo by Marilyn Swanson) By: Donald L Swanson “(b) Duties.—The [Subchapter V] trustee shall— . . . (7)facilitate the development of a consensual plan of reorganization.” From 11 U.S.C § 1183(b)(7)(emphasis added). Facilitation is, by statute, a duty of every Subchapter V trustee—something a Subchapter V trustee must do. But the nature... Continue Reading →
A “single asset real estate”? (Photo by Marilyn Swanson) By: Donald L Swanson Excluded from Subchapter V eligibility is a “single asset real estate” debtor. We have a recent opinion on a Subchapter V debtor who beats that exclusion: In re Evergreen Site Holdings, Inc., [Fn. 1] What follows is a summary of that opinion. Eligibility... Continue Reading →
Court authority? (Photo by Marilyn Swanson) By: Donald L Swanson In a mass-tort bankruptcy, when 95% of 120,000 creditors vote to accept a mediated plan paying over $7 billion to creditors, shouldn’t the plan be confirmed? That’s the question, decided in favor of plan confirmation by the Second Circuit Court of Appeals, in In re Purdue... Continue Reading →
Long-arm jurisdiction? (Photo by Marilyn Swanson) By: Donald L Swanson Mallory v. Norfolk Southern Railway Co.[fn. 1] has got to be one of the most unusual vote-count opinions at the U.S. Supreme Court. Get this: Justice Gorsuch writes a plurality opinion, vacating the judgment of the Supreme Court of Pennsylvania and remanding the case, (i) based... Continue Reading →
Dissenters? (Photo by Marilyn Swanson) By: Donald L Swanson Dissenting opinions are always interesting. Sometimes, they are even the most interesting part of the entire case. Two recent dissents, in opinions of the U.S. Supreme Court, are decided three days apart: on June 23 & 26 of 2023, respectively. The first opinion has a four-Justices dissent... Continue Reading →
Trade-Off: Bait & Tackle v. Coffee & Deli (Photo by Marilyn Swanson) By: Donald L Swanson There is trade-off theory going around for construing Subchapter V statutes. The theory is used to minimize benefits that Subchapter V statutes provide to debtors. The Theory The theory goes like this: elimination of the absolute priority rule is a... Continue Reading →
https://youtu.be/J-St2KJX6rk By: Donald L Swanson Subchapter V is the newest provision of the Bankruptcy Code—becoming effective on February 19, 2020. Subchapter V arose from a Report by the American Bankruptcy Institute’s Commission to Study the Reform of Chapter 11. Here is a link to the Commission’s “Recommendations” on “Small and Medium Sized Enterprise Cases,” which establish... Continue Reading →
Entrepreneurship (Photo by Marilyn Swanson) By: Donald L Swanson Subchapter V eligibility requires a debtor to be “engaged in” commercial/business activities. Case Law Consensus Case law consensus is that such activities must exist on the petition filing date. That means a debtor cannot utilize Subchapter V when: business assets are fully-liquidated; unpaid debts are the only... Continue Reading →
Eighth Amendment to U.S. Constitution By: Donald L Swanson “we need not decide whether she has also alleged an excessive fine under the Eighth Amendment.” --From U.S. Supreme Court’s unanimous opinion, Tyler v. Hennepin County, Minnesota, Case No. 22-166, at 14 (decided May 25, 2023). By now, everyone knows that the U.S. Supreme Court, in Tyler... Continue Reading →
A dilemma: elegance or country? (Photo by Marilyn Swanson) By: Donald L Swanson A Subchapter V Trustee “shall . . . facilitate the development of a consensual plan of reorganization.” [Fn. 1] This is a mediator-ish role: a “third party” who “participates to assist in the resolution of issues in controversy.” [Fn. 2] Subchapter V Trustee... Continue Reading →
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