On Bankruptcy and Mediation
By: Donald L. Swanson Here’s a scenario where early mediation intervention works: We’re at the beginning of a Chapter 11 case with lots of competing interests. Everyone is in a fight-every-battle mode—and there are lots of battles to fight. We’re past the initial flurry of motions for use of cash collateral and relief from stay,... Continue Reading →
By: Donald L. Swanson It's always great to see the leaders in any realm continue to innovate. The Bankruptcy Court in Delaware is, most definitely, a leader on such matters as bankruptcy mediation. And this Court continually innovates. In 2004, for example, the Delaware Bankruptcy Court adopts mandatory mediation for preference actions. And a telephone-participation... Continue Reading →
By Donald L. Swanson “for the reasons set forth on the record at the Hearing, the [Motion to Compel Mediation] is DENIED without prejudice.” U.S. Bankruptcy Judge, Delaware, July 20, 2016 Energy Future Holdings Corp. files Chapter 11 bankruptcy in 2014. Along the way, it engages in a mediation process that resolves nearly all objections... Continue Reading →
By: Donald L. Swanson It's always great to see an experiment produce successes that lead to an expansion of the experimental endeavor. This success-and-expansion is exactly what's happened with mandatory mediation experiments in the Delaware Bankruptcy Court. Delaware's Mandatory Mediation The Delaware Bankruptcy Court began mandating mediation, by local rule, in preference cases back in... Continue Reading →
By Donald L. Swanson Who would ever think that mediation could serve an important role in pre-packaged Chapter 11 cases? --After all, the essence of a pre-packaged plan is speed: all major issues are supposed to be resolved in advance of the bankruptcy filing so the plan can move promptly to confirmation. But disputes do... Continue Reading →
By: Donald L. Swanson "The court declines to adopt a new mediation privilege under the facts of this case." --Judge Cynthia A. Norton, U.S. Bankruptcy Judge -- December 19, 2016 The case is In re Lake Lotawana Community Improvement District, a Chapter 9 municipale bankruptcy in the Western District of Missouri (Case No. 16-42357). The issue... Continue Reading →
By: Donald L. Swanson The Court’s opinion is new: entered December 23, 2016. The case is In re Hunt, Case No. 14-13109, in the New Mexico Bankruptcy Court. The dispute is between the Chapter 13 Debtor and his home mortgage lender. Scheduled value of the home is $155,000, and the mortgage lien balance is $223,631... Continue Reading →
Action Item: Every bankruptcy court should have its own set of local rules on mediation. Every bankruptcy court without such rules needs to get them adopted. In the words of a famous Nebraskan: Let’s "git-r-done!”
By: Donald L. Swanson Mediation is standard dispute resolution tool in many bankruptcy cases – especially in large and complex cases. A limited number of bankruptcy courts, however, still haven’t adopted local mediation rules. Reasons for the absence of such rules are diverse and range from: --the somewhat-bizarre development in Chicago, where the Bankruptcy Court... Continue Reading →
By Donald L Swanson A “structured dismissal” of a Chapter 11 bankruptcy involves a settlement agreement among major parties that liquidates substantially all of debtor’s assets, distributes the proceeds, grants releases, and dismisses the bankruptcy case—all as a negotiated package deal. Most everyone will agree that a bankruptcy settlement with the following terms is a... Continue Reading →
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