On Bankruptcy and Mediation
By: Donald L. Swanson Some not-surprising facts about professional fees in the Nortel Networks bankruptcy are: --The total amount is massive; and --The burn-rate continues without abatement. Keep in mind that: --The primary question in the Nortel Networks bankruptcy is this: How should a $7.3 billion sale proceeds fund be distributed? --Professional fees in the... Continue Reading →
By: Donald L. Swanson Hypothetical: Bank’s borrower is in a lawsuit. Legal fees are mounting, with no end in sight. The attention of borrower’s management is consumed by it. Borrower’s business is suffering. And Bank wants borrower to get the case resolved. Question: Can Bank suggest, insist, or even demand, that customer schedule a mediation... Continue Reading →
“Nothing will lower your credibility faster than avoiding conflict.” --Morris Shechtman, 2003 By Donald L. Swanson Conflict is difficult. And conflict is uncomfortable. So, the easiest and most comfortable way to handle conflict . . . is to avoid it. That's why caucus-only mediation has become standard practice in many mediations of business disputes. In... Continue Reading →
By: Donald L. Swanson When mediation occurs early-in-a-case, instead of late, “cases are more likely to settle, fewer motions are filed and decided, and case disposition time is shorter, even for cases that do not settle.” --B. McAdoo, N. Welsh & R. Wissler, “What Do Empirical Studies Tell Us About Court Mediation?” (2004) A lawsuit... Continue Reading →
By Donald L. Swanson "🎶Harmony and understanding, Sympathy and trust abounding, . . . Aquarious🎶" --The Fifth Dimension The year is 1968. The musical "Hair" debuts on Broadway, with the self-assurance of those who have thrown off the norms of prior generations. Aquarius is now here, we are assured. I'm... Continue Reading →
By: Donald L. Swanson The plan confirmation process does not provide a party to the mediation “with a renewed opportunity to challenge the [mediated] settlement to which they are bound.” --In re RPP, LLC, 547 B.R.158, 164 (Bkrtcy.W.D.Pa. 2016). The RPP, LLC bankruptcy case is a Chapter 11 reorganization, with plan confirmation occurring on June... Continue Reading →
By: Donald L. Swanson Mediation is firmly entrenched as a dispute resolution tool in bankruptcy. Mediation is commonly and regularly used throughout the bankruptcy system. And mediation’s value in bankruptcy is almost-universally recognized. A Mediation Gap But there are wide gaps in bankruptcy where mediation is still under-utilized. One of the gaps is consumer cases. ... Continue Reading →
By: Donald L. Swanson The "early parts" of a case under the reorganization chapters of the Bankruptcy Code (chapters 9, 11, 12 and 13) involve many difficult battles. Early battles are over such issues as relief from stay, cash collateral and DIP financing. The burden of litigation in such matters "can be tremendous," and such... Continue Reading →
By Donald L. Swanson Nebraska statutes contain a Farm Mediation Act (Neb. Rev. Stat. § 2-4801 et seq). This Act requires a creditor to send notice of a mediation opportunity before attempting to collect a defaulted farm loan. The statute says: “At least thirty days prior to the initiation of a proceeding on an agricultural... Continue Reading →
By Donald L. Swanson Who would guess that pre-lawsuit mediation would work well in resolving credit disputes between creditors and farmers in stressed financial circumstances? But this is precisely what has happened in farm states under farm mediation statutes. Mandatory v. Voluntary Pre-Lawsuit Mediation Statutes Many farm states have established mediation prerequisites for a creditor... Continue Reading →
MEDIATBANKRY 