In ASM Capital LP v. Ames Dept. Stores Inc. (In re Ames Dept. Stores Inc.), No. 07-1362, 2009 WL 2972510 (2d Cir. Sept.
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Credit bidding, which has been used with increasing frequency as a tool for secured creditors to obtain possession of their collateral rather than receive the proceeds of a sale for consideration they view as inadequate, allows a secured creditor to set off sums owed to such secured creditor as a bid in certain sales of property of a debtor’s estate.
Many secured lenders do not realize the risks associated with lending upon collateral involving underground storage tanks (USTs).
An emerging strategy many hedge and private equity funds are pursuing is known as the “loan-to-own” investment. In this type of investment, a fund’s investors acquire debt and sometimes certain amounts of equity or management control, such as voting power or board seats, from a lender of a distressed company.
“But as the collapse of Lehman Brothers showed, the Bankruptcy Code is not an effective tool for resolving the failure of a global financial services firm in times of severe economic stress.”
Treasury Secretary Timothy Geithner, Oct. 29, 2009
May a creditor’s claim be disallowed simply because he or she failed to provide supporting documentation in violation of Rule 3001 of the Federal Rules of Bankruptcy Procedure? The answer depends on which jurisdiction the creditor is pursuing its claim in, and courts are currently sharply divided on the issue.
Editor's Note: The following article, "The Trouble of the $1,000 Billable Hour in Bankruptcy - Limitations of Professional Compensation by the
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Much has been written about what §503(b)(9) is not: It does not do enough to protect creditors; it gives too much leverage to vendors and not enough to the debtor;
Section 704(a) of the Bankruptcy Code enumerates the essential duties of a bankruptcy trustee in a chapter 7 case, requiring that the trustee “collect and reduce to money the property of the estate for which such trustee serves.” The courts have occasionally been asked to interpret whether this provision gives a g
