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Current decisions, news and commentary regarding commercial bankruptcy cases in Delaware.
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Corporate governance battles spill into bankruptcy courts and at times serve as the genesis for bankruptcy petition filings. For example, recently the Fifth Circuit in In re Franchise Services of North America Inc. addressed a motion to dismiss a bankruptcy petition on the basis that under the state law governing the would-be corporate debtor, the petition filing was unauthorized and invalid. This article discusses the Bankruptcy Code, federalism, corporate law and public policy. These routinely surface during disputes over whether a corporate debtor’s bankruptcy petition constitutes a valid authorized corporate action that should be allowed to proceed or, in the alternative, whether the bankruptcy petition is unauthorized and invalid and should be dismissed. More ›
Morris James was named a top work place for mid-sized employers in Delaware for the eleventh consecutive year. This year's top workplace honor makes Morris James the only law firm in Delaware to be consistently top-ranked in the mid-sized employers category for the past eleven years. More ›
Proceed with Caution: Although a False Oral Statement about a Single Asset Constitutes a Statement Respecting the Debtor's Financial Condition for Section 523(a) Purposes, the Associated Debt Can Still be Discharged
The Supreme Court held that a statement about a single asset can be a "statement respecting the debtor's financial condition" and instructed that if the statement was not in writing, then the associated debt may be discharged even if the statement was false. A copy of the opinion may be found here. More ›
Thirty Morris James attorneys in thirty-two practice areas were selected by their peers for inclusion in The Best Lawyers in America© 2019 edition. Additionally, three of those attorneys were named “Lawyer of the Year” for their respective practices, including David H. Williams for Education Law, Employment Law – Management, and Litigation – Labor and Employment, Richard Galperin for Healthcare Law, Medical Malpractice - Defendants, and Personal Injury Litigation – Defendants, and John M. Bloxom, IV for Real Estate. Congratulations to Kenneth L. Dorsney, Shannon S. Frazier, Kevin G. Healy, Eric J. Monzo, John H. Newcomer, Jr., K. Tyler O’Connell and Jill Spevack Di Sciullo for being recognized for the first time. More ›
Breaking Up is Hard to Do: No Administrative Expense Warranted for Purchaser's Expenses Incurred During Failed Effort to Obtain Regulatory Approval
On August 1, 2018, Chief Judge Christopher Sontchi issued another opinion in the Energy Future Holdings bankruptcy cases. The opinion addresses the question whether failed purchaser NextEra Energy, Inc. ("NextEra") is entitled to a $60 million administrative expense claim related to its fees and expenses incurred in attempting to close the transaction with the Debtors for control of the Debtors’ economic interest in Oncor. The Bankruptcy Court held that it is not. A copy of the opinion may be found here. More ›
The United States Senate confirmed Colm F. Connolly and Maryellen Noreika as US District Judges for the District of Delaware. Connolly and Noreika will fill the two vacancies resulting from the retirements of Judges Sue L. Robinson and Gregory M. Sleet.
Bankruptcy Court Has Subject Matter and Non-Core Jurisdiction Over Action to Recover Debtor’s Accounts Receivable
On July 2, 2018, Chief Bankruptcy Judge Sontchi issued an opinion in connection with the chapter 7 liquidation of Pennysaver USA Publishing, LLC regarding whether the bankruptcy court has subject matter jurisdiction over the Trustee's action to recover disputed accounts receivable as part of the liquidation of the case. The opinion is captioned Beskrone, Chapter 7 Trustee v. Int’l Educ. Corp. (Adv. Pro. No. 17-50523 CSS) and a copy can be found here. More ›
In a non-precedential opinion filed on July 17, 2018, a copy of which may be found here, the Third Circuit Court of Appeals affirmed the rulings of the Delaware District Court and Delaware Bankruptcy Court, which approved an asset purchase agreement over a landlord's objection and allowed debtors Haggen Holdings, LLC and its affiliates to sell certain assets. The issue turned on the application of Bankruptcy Code § 365(f)(1) to a "profit sharing plan" clause in a commercial lease and whether it was an unenforceable anti-assignment provision. More ›
On July 6, 2018, Bankruptcy Judge Kevin Carey issued an opinion in connection with the Katy Industries Inc. bankruptcies that dismissed claims against the sole bidder (and ultimately successful asset purchaser) and others seeking to recharacterize or subordinate, avoid and recover a portion of the bidder's credit bid used to purchase the debtors' assets. There was no practical, useful remedy that resulted in any recovery to the estate. Nether recharacterization nor subordination would enhance any potential distribution to creditors. A copy of the opinion may be found here. More ›
Morris James Assists its Trustee and Agency Clients and Co-Counsel on Three Turnaround Atlas Award Winning Deals
The Bankruptcy & Creditors' Rights Practice Group of Morris James LLP is pleased to recognize its clients and co-counsel for their work on the following transactions resulting in three 2018 Global M&A Network Turnaround M&A Atlas Awards: More ›
On June 20, 2018, Judge Carey of the Delaware Bankruptcy Court issued an opinion in the Woodbridge Group of Companies bankruptcies enforcing an anti-assignment clause contained in a promissory note to restrict assignment rights to third parties. The opinion and order (a copy found here, and dated June 20, 2017 but later amended to June 20, 2018), nullified the attempted transfer of a promissory note and resulting proof of claim filed by the transferee. The Court found that the anti-assignment clause in the notes was enforceable under Delaware law, the tenets of contract law and the Uniform Commercial Code. More ›
Jeffrey R. Waxman, Counsel to the Alleged Victims of Harvey Weinstein, was Quoted in Law360, Bloomberg and Variety Magazine
During the hearing in Wilmington, Delaware, the Weinstein Co. lost its fight to keep Harvey Weinstein’s employment contract secret. That document shows that Harvey Weinstein's actions were facilitated by the company, Jeffrey Waxman, a Morris James partner and bankruptcy lawyer for the alleged victims, said in court. Click on the links below for the full articles.
Brett Fallon and Brenna Dolphin Author Article on Sanctions Published by the American Bankruptcy Institute
Let’s Ask for Sanctions! (But What Kind?)
Originally published by the American Bankruptcy Institute 2018.
Courts might issue sanctions pursuant to statute,rule of procedure or inherent power, but keep in mind the American Rule: Each party bears its own attorneys’ fees and litigation expenses, and attorneys’ fees are not ordinarily among the costs that a prevailing party might recover. Courts employ narrow exceptions when imposing sanctions, which might properly have a punitive aspect
and compensatory effect. This article will review 28 U.S.C. § 1927, Rule 9011 of the Federal Rules of Bankruptcy Procedure, the inherent-power doctrine and 11 U.S.C. § 105. Read more.
Delaware Super Lawyers® magazine has recognized five Morris James partners as top legal counsel in Delaware and five "Rising Stars®" attorneys. "Rising Stars®” is a recognition for lawyers who are 40 or under, or who have been practicing for 10 years or less.
Super Lawyers® selects outstanding lawyers from more than 70 practice areas throughout the United States who have attained a high degree of peer recognition and professional achievement. The selection process includes independent research, peer nominations, and peer evaluations. Only the top five percent of attorneys in each state are honored as Super Lawyers in this annual list, and the Rising Star selection is limited to only 2.5 percent of eligible attorneys, according to Super Lawyers’ website.
Morris James attorneys recognized on the 2018 Delaware Super Lawyers® list are:
P. Clarkson Collins
Jason C. Jowers
Lewis H. Lazarus
Edward M. McNally
Employment and Labor:
David H. Williams
Business Litigation Rising Stars:
Meghan A. Adams
Albert J. Carroll
Patricia A. Winston
Medical Malpractice Rising Stars:
Chambers USA: America's Leading Lawyers for Business Recognizes 15 Morris James Lawyers and Issues 5 Firm Practice Rankings in the 2018 Edition
Thirteen Morris James partners have been named leaders in their respective fields by Chambers USA, and two additional partners were named “recognized practitioners” in Delaware for Corporate/M&A: Alternative Entities. Morris James also received five practice recognitions.
Clarkson Collins Jr.
Lewis H. Lazarus
Edward M. McNally
Brett D. Fallon
Carl N. Kunz III
Stephen M. Miller
Corporate/M&A: Alternative Entities
John M. Bloxom IV
Real Estate & Zoning/Land Use
Labor & Employment**
James H. McMackin III
David H. Williams
Richard K. Herrmann
Mary B. Matterer
* Recognized Practitioner
** Recognized Practice Areas