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| vol 18, num 4 | September 2021 |
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| Sixth Circuit Underscores the Importance of Due Process in § 363(f) Sales |
| One of the primary purposes of chapter 11 is to maximize the value of a debtor’s assets. Section 363(f), which allows adebtor to sell its assets free and clear of any liens, claims, interests or encumbrances, helps effectuate this purpose. Indeed, § 363(f) has often been described as a “powerful tool.” But with great power comes great responsibility: Among other things, in order to sell free and clear under § 363(f), creditors and parties in interest generally must be provided at least 21 days’ notice of the proposed sale. Federal Rule of Bankruptcy Procedure 2002(l) provides that the bankruptcy court may allow notice by publication
if it determines that notice by mail is impracticable. |
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| Asset Sales Committee Announces Winner of 2021 Annual “Asset Sale of the Year” Award |
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| ABI’s Asset Sales Committee announced that In re Verity Health System of California Inc., Case No. 2:18-bk-20151-ER (C.D. Cal.), won the committee’s third annual “Asset Sale of the Year” award. The committee said that it selected Verity as the top asset sale because the sale (1) was part of one of the largest hospital bankruptcies ever filed; (2) established important precedent regarding the transfer of Medicare and Medicaid Provider Agreements in a bankruptcy case and the limited scope of the California Attorney General’s powers over the sale of nonprofit health care assets in bankruptcy; and (3) saved important
institutional hospitals, preserving thousands of jobs and ensuring that residents in these counties and communities continue to have access to critical health care. Honorable mentions from the submissions received included the asset sales in In re Southern Foods Group LLC, et al. (S.D. Tex.) and In re OGGUSA Inc., f/k/a GenCanna Global USA Inc. (E.D. Ky.). |
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