Blakeley & Blakeley LLP
In 2005, Congress recognized the value that vendors that ship goods to debtors on the eve of bankruptcy provide to the estate. Specifically, Congress added § 503(b)(9) to the Bankruptcy Code, which provides that a creditor shall have an administrative-expense priority claim for “the value of goods received by the debtor within 20 days before the date of commencement of a case under this title in which the goods have been sold to the debtor in the ordinary course of business.” In effect, this Code provision provides vendors that fall within this section a claim that enjoys priority in payment over general unsecured non-priority claimants. As in most areas of the law, the question then becomes how the courts will apply this Code section to any given set of facts.
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Latham, Shuker, Eden & Beaudine LLP
The effects of the epic real estate collapse that have occurred over the last five years are well known. The subprime mortgage crisis has caused residential (as well as commercial) real estate property values to drop significantly, which was has not been seen since the Great Depression. Millions of foreclosure sales across the nation have left banks and mortgagees holding the undesired title of “largest landowners in the United States.” As the economy and residential real estate market attempt to recover, homeowner’s or condominium associations continue to suffer. These nonprofit entities are responsible, in many cases, for the upkeep, maintenance and insurance of the common areas of the development or community for the benefit of its members: the homeowners. An association’s main source of revenue is the association members’ assessments or dues that are collected pursuant to most homeowner’s declarations and enforced under applicable state law.[1]
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New York
Every so often a decision comes along that engenders heated debate but then, it seems, it cools off before being able to develop into something more. Even more quickly is this decision forgotten. In the wake of General Growth Properties (GGP),[1] many law firms and financial consultants analyzed the legal ramifications. The GGP decision was dubbed seminal, even transformative, yet the immediate takeaway that resounded was much of the same timeless rhetoric: bankruptcy-remote is not bankruptcy proof. In the year that has passed since the decision, this article will review the relevant facts and the decision—so as not to be forgotten—and will address the real implications, if any, on bankruptcy law in the time subsequent. The article will then opine that the decision actually stands for a simple proposition, one that is as omnipresent as it is forgettable: Lenders cannot hold securitized assets of an integrated corporate and capital structure while, at the same time, believe the assets are bankruptcy-remote.
This article will explain the inner workings of a special purpose entity, describe the corporate and capital structure of GGP, and depict the financial environment of the months leading up to the bankruptcy filings. The article will then discuss the bankruptcy filings and the subsequent five motions to dismiss brought by secured lenders. A large part of the information contained within this article derived from the Aug. 11, 2009, decision and the objections of the debtors’ and creditors’ committees.
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Faculty for the Mid-Level Professional Development Program include Corinne Ball, Douglas Bartner, Kenneth Buckfire, Timothy Coleman, William Derrough, Hon. Robert Drain, Robert Duffy, Holly Etlin, Matthew Feldman, Marcia Goldstein, Benjamin Kaminetzky, Christopher Kearns, Adolfo Laurenti, Susan Manch, Bruce Mendelsohn, Shary Moalemzadeh, Homer Parkhill, Mark Power, Barry Ridings, Howard Seife, Joseph Smolinsky and James Sprayregen.
You can only see this all-star faculty at the ABI Professional Development Program, developed for mid-level insolvency and restructuring professionals, to be held on Oct. 28, 2010, at the Weil, Gotshal & Manges Conference Center in New York. Attendees will hear panel presentations on current topics as well as learn negotiation, networking and networking skills. A networking cocktail reception will be held at the end of the program for all attendees. Register online at www.abiworld.org/PDP10 and don’t miss this one-of-a-kind event!
ABI's 7th Annual Complex Financial Restructuring Program will be held September 20 at the Fordham University School of Law in New York. This program offers a unique opportunity to gain an understanding of the various roles played by investment bankers, financial advisors and others representing stakeholders in today's complex cases. This year's hypothetical case of "Vandelay Industries Inc." will be dramatized by parties-in-interest as they examine strategic alternatives and seek the highest value for a troubled company. Throughout the one-day program, experienced professionals from the fields of finance, investment banking, accounting, law and turnaround play the roles of the constituents - company board, management, secured debt, trade creditors, attorneys and advisors, the government and others. From the decision concerning whether to file for bankruptcy through the exit strategy, the parties grapple with the real-world problems in real-time. Their positions frequently conflict and the debates can be heated, just as in today's cases.
This year will also mark the First Annual Anthony H.N. Schnelling Lecture in Commercial Bankruptcy. The lecture will feature a leading figure in the restructuring world, as a tribute to the memory of Tony Schnelling, a former ABI Vice President-Development. The first lecturer will be Hon. Burton R. Lifland, who, like Tony, is an alumnus of Fordham University School of Law.
Don't miss this unique, interactive event. Register today!
The ABI is pleased to join the New York University School of Law and the NYU Center for Law & Business to present this year's 36th Annual Lawrence P. King and Charles Seligson Workshop on Bankruptcy and Business Reorganization on September 22-23 in New York. This two day-long workshop includes a Basic Program designed for entry-level business bankruptcy lawyers, general practitioners and business professionals, as well as an Advanced Program for experienced practitioners and financial professionals. The program will again address the topics that practitioners need - fundamental business bankruptcy as well as advanced panels covering current issues. Click here to register today.
