Playing Craps in the Bankruptcy Sandbox:
Practice Guideposts and Issues in Gaming Industry Restructurings
Under the gaming laws of virtually every state, a gaming license is not considered to be property of the holder, but rather a revocable, nonassignable (absent Gaming Authority consent) privilege to conduct permitted gaming activities. However, when a bankruptcy petition is filed, an estate is created pursuant to §451(a) of the Bankruptcy Code. The term “estate” is broadly defined in §541(a) to include all of a debater’s legal or equitable interests in property, whether it is tangible or intangible. (Property interests are interpreted in an expensive manner, and it is federal, not state, law that determines the scope of estate property.) United States v. Whiting Pools, Inc., 462 U.S. 198,205 (1983); Butner v. United States, 440 U.S 48, 55 (1979).
Gaming Industry Restructuring Issues: The Balance Sheet Challenge
The Balance-Sheet Challenge – Why Gaming Cases Are Different
The traditional balance-sheet restructuring mechanic of converting debt into equity to deleverage the balance sheet can conflict with the desires of large creditors to avoid licensing.
Putting It All on Black and Other Strategies for Casino Reorganizations
First-Day Orders and Doctrine of Necessity
Hotel casino reorganizations inevitably require first-day orders (1) of the type common to all business reorganizations and (2) unique to the gaming industry. Typical first-day orders commonplace in any business reorganization are applications to pay pre-petition, payroll and honor employee benefits:
Minutes From Winter Leadership Conference
The subcommittee on Hospitality, Entertainment Venues and Gaming, together with the Investment Baking Committee, held a joint meeting and educational presentation. In addition to the materials prepared by Rudy Cerone (member, McGlinchey Stafford, PLLC; New Orleans), Robert Jay Moore (partner, Financial Restructuring Group, Milbank, Tweed, Hadley & McCloy; Los Angeles), Steven R. Strom (managing director, Financial Restructuring Group CIBC World Markets; New York) and William H. Hardie, III. (managing director, Houlihan Lokey Howard and Zukin), Hon. Linda B. Riegle (U.S. Bankruptcy Court, D. Nev.) and James Patrick Shea (Shea & Carlyon, Ltd.; Las Vegas) assisted in the panel presentation.
The presentation was well attended and well received. Additionally, approximately 40 individuals indicated a desire to join the subcommittee.
Rudy Cerone was appointed co-chair of the Bankruptcy Litigation Committee; to Candace C. Carlyon (Shea & Carlyon, Ltd.; Las Vegas) is now chair of the Subcommittee on Hospitality, Entertainment Venues and Gaming.
The next subcommittee meeting will be held in conjunction with the ABI Annual Spring Meeting on Friday, April 21, 2006 at 2:15 pm. Committee members are urged to contact Candace Carlyon if they are willing to assist in the committee’s publications, educational presentations and communications. All members are urged to actively recruit additional members to the subcommittee.