On September 14, 2015, the Third Circuit released a precedential opinion (the “Opinion”) which addressed payments from a buyer to non-debtor parties in a 363 sale. The Third Circuit’s opinion
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363 Sales
An Update on the Deb Shops Bankruptcy
Introduction
On June 26, 2011, clothing retailer Deb Shops, Inc. (“Deb”) and its related entities filed petitions for bankruptcy in the United States Bankruptcy Court for the District of Delaware…
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Thompson Publishing Files for Bankruptcy, Hoping to Complete a 363 Sale of Assets
Introduction
On September 21, 2010, Thompson Publishing Holding Co., Inc. (“Thompson”) and various related entities, filed petitions for bankruptcy in the United States Bankruptcy for the District of Delaware. …
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Magic Brands, Owner of Fuddruckers and Koo Koo Roo, Files for Bankruptcy
Introduction
Magic Brands, LLC, the owner of food chains “Fuddruckers” and “Koo Koo Roo,” filed for bankruptcy in Delaware on April 21, 2010. The company filed a chapter 11 petition …
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A Tale of Two Bankruptcy Auctions
Introduction
In recent months, bankruptcy auctions went forward in two different bankruptcy proceedings that illustrate the extent to which auctions can vary both procedurally and substantively. One auction involved the…
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MagnaChip Semiconductor Files for Bankruptcy Seeking Approval of Asset Sale and Plan of Liquidation
Introduction
On June 12, 2009, MagnaChip Semiconductor (“MagnaChip”), filed a Chapter 11 Petition for Bankruptcy in the United States Bankruptcy Court for the District of Delaware. As reflected in…
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A Closer Look at Chapter 11 Bankruptcy Auctions
Introduction
On May 1, 2009, Magna Entertainment (“Magna”) filed a motion in the United States Bankruptcy Court for the District of Delaware whereby it sought authority to schedule an auction,…
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When Is The Stalking Horse Break-up Fee A Benefit To The Bankruptcy Estate: Another Look at Calpine v. O’Brien Environmental Energy
Today in the PPI Holdings bankruptcy, the PPI debtors presented their bid procedures motion which sought approval of the procedures by which PPI would sell substantially all of its assets. PPI’s motion also sought approval of a break-up fee for the stalking horse bidder. In support of the break-up fee, PPI cited the Third Circuit’s decision in Calpine Corp. v. O’Brien Envtl. Energy, Inc. (In re O’Brien Envtl. Energy, Inc.), 181 F.3d 527 (3d Cir. 1999).
Given the increase in bankruptcies, break-up fees will continue to be an issue for debtors and creditors alike. The purpose of this post is to take a look at the O’Brien decision and consider when a break-up fee is appropriate, and the factors courts will consider in deciding to award such fees.Continue Reading When Is The Stalking Horse Break-up Fee A Benefit To The Bankruptcy Estate: Another Look at Calpine v. O’Brien Environmental Energy