Cozen O’Connor: Bankruptcy, Insolvency & Restructuring

Bankruptcy, Insolvency & Restructuring

Featured Publication:

In Pari Delicto: Neither Fish Nor Fowl [Delaware Business Court Insider]

Barry Klayman and Mark Felger authored an article in the Delaware Business Court Insider, discussing a recent decision of the Court of Chancery of Delaware holding that the defense of in pari delicto is not limited either to actions in equity or at law, and may be asserted as a defense by the Receiver of an insurance company to a legal claim brought in a statutory liquidation proceeding pending in the Court of Chancery.

More

Cozen O'Connor represents key parties on all sides of bankruptcy and restructuring matters, including large corporate debtors, secured and unsecured creditors, creditors’ committees, and trustees. On the debtor side, we quickly assess the client’s options and devise a workable solution, whether the client is looking to refinance or restructure debt, or to sell substantially all of its assets through an out-of-court process or a Chapter 11 proceeding. On the creditor side, we implement strategies for creditors and creditors’ committees to maximize their recoveries against debtors in an expeditious manner. We also represent trustees in administering complex Chapter 7 cases, pursuing litigation against third parties, and selling business assets under a court-sanctioned auction process. Overall, our goal in every engagement is to restructure or liquidate in a way that preserves and maximizes value.

Unlike much corporate work, bankruptcy often involves dozens or even hundreds of directly interested parties. To reach a mutually acceptable solution, counsel must accurately assess and coordinate a host of divergent interests. The lawyers at Cozen O’Connor have experience representing parties on all sides of bankruptcy matters, which means they are quick to anticipate the needs and priorities of divergent constituencies and devise a winning strategy for the client. They also serve as mediators in high-level disputes, so they are adept at focusing negotiations and navigating smoothly around potential roadblocks.

Bankruptcy is unique from other practice areas, because it combines transactional and litigation practice. Attorneys must design complicated contracts as readily as they make oral arguments. Cozen O’Connor’s bankruptcy attorneys’ breadth of experience in putting deals together and trying cases makes them ideally suited to operate at this legal crossroads. Our bankruptcy attorneys have extensive trial experience and move easily between the courtroom and the conference room.

Whether overseeing a Chapter 11 case on behalf of a creditors’ committee, declaring insolvency, executing an out-of-court restructuring, or lodging a cross-border complaint, bankruptcy-related matters move fast. Our practice is structured to facilitate prompt team formation, which allows us to get up and running without delay. The firm has local offices in 24 different cities in the United States, Canada, and the United Kingdom, including Houston, and the important bankruptcy hubs, New York City and Wilmington, Del. Accordingly, when a matter demands quick action, our attorneys are already on location. No matter how fast the pace, neither quality of work nor client communication is ever compromised.

 

SERVICES

  • Represent large private and publicly held businesses in Chapter 11 proceedings
  • Represent trustees in Chapter 7 liquidation and Chapter 11 reorganization cases
  • Represent creditors’ committees in Chapter 11 proceedings
  • Represent purchasers and sellers in Section 363 sales
  • Represent lenders, developers, and investors in real estate insolvencies and restructurings
  • Counsel creditors on reorganizations, foreclosures, and liquidation proceedings
  • Counsel clients on out-of-court restructurings and workouts
  • Advise clients who sell, buy, or invest in distressed and insolvent businesses
  • Advise boards of public and private companies in the midst of financial crises
  • Represent clients in all forms of litigation arising from bankruptcy and insolvency

 

CLIENTS

  • Corporate debtors
  • Secured and unsecured creditors
  • Creditors’ committees
  • Trustees
  • Foreign representatives
  • Purchasers of assets
  • Investors
  • Insurers
  • Developers
  • Landlords and equipment lessors

 

TEAM

Cozen O’Connor’s bankruptcy team is comprised of extraordinarily well-qualified attorneys. The group includes lawyers recognized by the American Board of Certification, Chambers & Partners, and Best Lawyers in America. Senior members of the team chair bar association bankruptcy sections, serve on boards of industry organizations and serve as adjunct law school faculty.

Our goal is to transcend the role of outside counsel and become a true business partner. That requires an ability to listen and understand client goals. It also requires a different approach to staffing than most large law firms. We believe that major matters are best handled by small teams of veteran attorneys. When a firm assigns twelve different lawyers to manage twelve different tasks, no one sees the whole picture and, worse yet, no one is accountable. At Cozen O’Connor, we staff in ways that both support the development of comprehensive solutions and ensure accountability and efficiency. 

Experience

Publications

In Pari Delicto: Neither Fish Nor Fowl [Delaware Business Court Insider]

November 06, 2019

Barry Klayman and Mark Felger authored an article in the Delaware Business Court Insider, discussing a recent decision of the Court of Chancery of Delaware holding that the defense of in pari delicto is not limited either to actions in equity or at law, and may be asserted as a defense by the Receiver of an insurance company to a legal claim brought in a statutory liquidation proceeding pending in the Court of Chancery.

After Reargument, Chancery Affirms There Is No Bar to an Advance Waiver of Appraisal Rights [Delaware Business Court Insider]

October 09, 2019

Barry Klayman and Mark Felger authored an article in the Delaware Business Court Insider, discussing a recent decision of the Court of Chancery of Delaware holding that the Delaware General Corporation Law does not prohibit sophisticated owners of a corporation from including provisions in a merger agreement that bind them to a future sale of the resulting entity and the waiver in advance of their statutory appraisal rights.

Court: Liability Limitation Is Ambiguous Where Its Application Would Lead to Absurd Results [Delaware Business Court Insider]

September 04, 2019

Barry Klayman and Mark Felger authored an article in the Delaware Business Court Insider discussing a recent decision in the Delaware Superior Court, holding that a liability limitation in an agreement is ambiguous where its application would result in an absurd result.

Liquidating Trustee Succeeds to Privileges of Former Audit Committee [Delaware Business Court Insider]

August 07, 2019

Barry Klayman and Mark Felger discuss a recent decision of the Delaware Bankruptcy Court holding that a liquidating trustee succeeds to the privileges held by the debtor’s former audit committee.

Chancery Enforces Contractual Protections for Privileged Pre-Merger Communications [Delaware Business Court Insider]

July 03, 2019

Barry Klayman and Mark Felger discuss a recent case from the Delaware Court of Chancery upholding the use by the seller of a business of contractual provisions in a merger agreement to protect pre-merger, privileged communications between the seller and its counsel in negotiating the merger and prevent their use by the buyer in subsequent litigation with the seller.

Superior Court Holds Chancery Jurisdiction Does Not Extend to All Contracts Involving LLCs [Delaware Business Court Insider]

May 08, 2019

Barry Klayman and Mark Felger discuss a recent case from the Delaware Superior Court holding that the Delaware Limited Liability Company Act does not confer jurisdiction on the Court of Chancery over all contracts involving LLCs.

Serving Process on a Dissolved LLC [Delaware Business Court Insider]

April 03, 2019

Barry Klayman and Mark Felger discuss a recent case from the Delaware Court of Chancery explaining the requirements for serving process on a dissolved limited liability company, in order for the plaintiff creditors to recover funds allegedly owed them by the defunct company.

Chancery Applies Flexible Approach to 'Line of Business' Test in Corporate Opportunities [Delaware Business Court Insider]

March 13, 2019

Barry Klayman and Mark Felger authored an article in the Delaware Business Court Insider, discussing a recent case from the Delaware Court of Chancery explaining the contours of the “line of business” test for purposes of the corporate opportunities doctrine.

Master in Chancery Finds an Enforceable Equitable Mortgage Despite Defects in Execution

February 20, 2019

Barry Klayman and Mark Felger authored an article in the Delaware Business Court Insider discussing a recent final report submitted by a Master in Chancery in Delaware, finding that an equitable mortgage was enforceable despite defects in the execution of the mortgage.

Chancery Finds 'Mutual General Release' to Be Not All Encompassing

January 17, 2019

Barry Klayman and Mark Felger co-authored an article in the Delaware Business Court Insider discussing a recent decision by the Delaware Court of Chancery regarding a mutual general release.

Whose Lien Is It, Anyway? Decisions Regarding Maritime Liens Against Vessels

January 14, 2019

John T. Carroll, III and Simon E. Fraser authored an article titled “Whose Lien Is It, Anyway? Decisions Regarding Maritime Liens Against Vessels” which appears in the latest edition of the American Bankruptcy Institute Journal.

Chancery Refuses TRO That Would Act as Prior Restraint on Speech

December 19, 2018

Barry Klayman and Mark Felger co-authored an article in the Delaware Business Court Insider discussing a recent decision by the Delaware Court of Chancery refusing to grant a TRO in a business dispute.

Adviser-Consultants Held Not 'Other Professionals' for Purposes of Section 327(a) of the Bankruptcy Code

November 07, 2018

Barry Klayman and Mark Felger co-authored an article in the Delaware Business Court Insider discussing a pair of decisions from the Delaware Bankruptcy Court that address whether persons providing services to debtors relating to the disposition and monetization of real estate, intellectual property, and other estate assets are “professionals.”

Decisions to Clarify Time to Seek Attorney Fees for Frivolous Appeal

October 10, 2018

Barry Klayman and Mark Felger co-authored an article in the Delaware Business Court Insider discussing a pair of decisions from the Court of Chancery and the Delaware Supreme Court.

Bankruptcy Court Enforces Anti-Assignment Clause and Rejects Assignee’s Proof of Claim

September 05, 2018

Barry Klayman and Mark Felger co-authored an article in the Delaware Business Court Insider discussing a recent case from the Delaware Bankruptcy Court holding that an anti-assignment clause in a promissory note was enforceable under Delaware law.

Court Denies Public Access to Unfiled Discovery Materials

August 06, 2018

Barry Klayman and Mark Felger co-authored an article in the Delaware Business Court Insider, discussing a recent case from the Delaware Court of Chancery holding that materials developed during the pretrial discovery process and not filed with the court are not part of the public record.

Creditors Committee Dissolves Upon Conversion of Chapter 11 Cases [Delaware Business Court Insider]

June 27, 2018

Barry Klayman, a member of Cozen O’Connor’s Commercial Litigation and Bankruptcy, Insolvency & Restructuring Practice Groups, and Mark Felger, co-chair of the Bankruptcy, Insolvency & Restructuring Practice Group, co-authored an article in the Delaware Business Court Insider discussing a recent case from the District of Delaware holding that a creditors committee automatically dissolved when a Chapter 11 case was converted to Chapter 7.

Former Client Entitled to Attorney’s Entire Litigation File Including Internal Work Product [Delaware Business Court Insider]

June 07, 2018

Barry Klayman and Mark Felger co-authored an article in the Delaware Business Court Insider, discussing a recent Delaware Court of Chancery case.

Bankruptcy Court Enjoins Creditor From Pursuing Claims in Chancery in Chapter 11 Trust Liquidation [Delaware Business Court Insider]

May 09, 2018

Barry Klayman, a member of Cozen O’Connor’s Commercial Litigation and Bankruptcy, Insolvency & Restructuring Practice Groups, and Mark Felger, co-chair of the Bankruptcy, Insolvency & Restructuring Practice Group, co-authored an article in the Delaware Business Court Insider, discuss a recent Delaware Bankruptcy Court case enjoining a creditor from pursuing breach of fiduciary duty claims and other claims against a debtor’s former officers and early round investors in the Court of Chancery based on provisions of the debtor’s Chapter 11 plan of liquidation.

Chancery Addresses Subrogation Rights in the Context of Claims for Indemnification [Delaware Business Court Insider]

April 04, 2018

Barry Klayman, a member of Cozen O’Connor’s Commercial Litigation and Bankruptcy, Insolvency & Restructuring Practice Groups, and Mark Felger, co-chair of the Bankruptcy, Insolvency & Restructuring Practice Group, co-authored an article in Delaware Business Court Insider on a recent Court of Chancery case dealing with the rights of a putative subrogee in the context of a claim for indemnification of defense costs.

Latest Decision on Intersection of Reclamation Rights and DIP Liens

March 19, 2018

Simon Fraser, a member of Cozen O'Connor's Bankruptcy, Insolvency & Restructuring Department, wrote an article for the American Bankruptcy Institute Journal focusing on reclamation rights and DIP liens.

Financial Distress Is a Prerequisite to Good-Faith Bankruptcy Filing [Delaware Business Court Insider]

March 07, 2018

Mark Felger, co-chair, and Barry Klayman, a member of Cozen O'Connor's Bankruptcy, Insolvency & Restructuring Practice Group, co-wrote an article in Delaware Business Court Insider about the In re Rent-A-Wreck of America, Case that was dismissed by the district of Delaware.

Stockholders Agreement Interpreted to Not Run Afoul of DGCL [Delaware Business Court Insider]

February 14, 2018

Barry Klayman and Mark Felger, members of Cozen O'Connor's Commercial Litigation and Bankruptcy, Insolvency & Restructuring Practice Groups, discuss a recent Delaware Court of Chancery case, Schroeder v.Buhannic in the Delaware Business Court Insider.

Bankruptcy Judge Applies Anti-Forfeiture Statute to Save Debtor's Exercise of Option to Renew Lease [Delaware Business Court Insider]

January 17, 2018

Barry Klayman and Mark Felger, members of Cozen O'Connor's Commercial Litigation and Bankruptcy, Insolvency & Restructuring Practice Groups, discuss a recent Delaware bankruptcy case, In re Fresh-G Restaurant Intermediate Holding, in Delaware Business Court Insider.

Receiver's Disallowance of Creditor's Claim Subject to De Novo Review [Business Court Insider]

December 06, 2017

Barry Klayman and Mark Felger, members of Cozen O’Connor’s Bankruptcy, Insolvency & Restructuring Practice Group, discuss case B.E. Capital Management Fund v. Fund.com in Delaware Business Court Insider.

Bankruptcy Court Affirms Authority to Approve Nonconsensual Third-Party Releases [Delaware Business Court Insider]

November 08, 2017

Barry Klayman and Mark Felger, members of Cozen O’Connor’s Bankruptcy, Insolvency & Restructuring Practice Group, discuss the significant decision reached in In re Millennium Lab Holdings II, in Delaware Business Court Insider.

Corporation Is Not Precluded From Contradicting Its Own 30(b)(6) Witness [Delaware Business Court Insider]

October 11, 2017

Barry Klayman and Mark Felger, members of Cozen O’Connor’s Bankruptcy, Insolvency, & Restructuring Practice Group, discuss, in the Delaware Business Court Insider, a recent case in which the Delaware Court of Chancery refused to preclude a defendant corporation from offering evidence at trial that contradicted or was otherwise inconsistent with the deposition testimony of its Rule 30(b)(6) witness, although the plaintiffs would be able to rely on the earlier 30(b)(6) testimony and use it for impeachment.

Bankruptcy Court Predicts Del. Will Recognize Existence of De Facto LLCs [Delaware Business Court Insider]

September 06, 2017

Barry Klayman and Mark Felger, members of Cozen O’Connor’s Bankruptcy, Insolvency & Restructuring Practice, discuss a recent case in which the Bankruptcy Court for the District of Delaware predicted that the state’s courts would recognize the existence of de facto limited liability companies, just as they recognize de facto corporations, in Delaware Business Court Insider.

Drop Shipped Goods Failed to Qualify for Administrative Expense Priority in Bankruptcy [Delaware Business Court Insider]

August 09, 2017

Barry Klayman and Mark Felger, members of the Cozen O’Connor Bankruptcy, Insolvency & Restructuring Practice Group, discuss in the Delaware Business Court Insider a recent case in which the Bankruptcy Court for the District of Delaware held that goods delivered directly to the debtor's customers within 20 days prior to the bankruptcy petition, even though at the debtor's direction and utilizing the debtor's account with the shipper, will not qualify for administrative priority treatment under section 503(b)(9) of the Bankruptcy Code because the debtor never had physical possession of the goods.

Courts Split Over Interpretation of CIMLA Provisions Regarding Suppliers’ Maritime Liens Against Vessels

July 12, 2017

John T. Carroll, III and Simon E. Fraser, both members of Cozen O’Connor’s Bankruptcy, Insolvency & Restructuring Practice, discuss in an article with the American Bankruptcy Institute, Secured Credit Committee the interpretation of the Commercial Instruments and Maritime Lien Act (CIMLA), which protects suppliers of goods by granting a maritime lien against any vessel to which the supplier provides “necessaries.”

Standing in Foreclosure Actions Requires Holding Both Mortgage and Note [Delaware Business Court Insider]

July 05, 2017

Barry Klayman and Mark Felger, members of Cozen O'Connor's Bankruptcy, Insolvency & Restructuring Practice, discuss in the Delaware Business Court Insider a recent case in which a divided Delaware Supreme Court held that a mortgage assignee must be entitled to enforce the underlying obligation that the mortgage secures in order to foreclose.

Court Lacks Personal Jurisdiction Over Nonresident Blogger, Website Host [Delaware Business Court Insider]

June 07, 2017

Barry Klayman and Mark Felger discuss a case from the Delaware Superior Court dealing with the issue of an allegedly defamatory article that caused injury to a Delaware corporation hosted on a website outside of Delaware.

Tribal Sovereign Immunity of Casinos in Preference Actions [Delaware Business Court Insider]

May 10, 2017

Mark Felger and Barry Klayman discuss a recent case from the Delaware Bankruptcy Court in The Delaware Business Court Insider.

Delaware Bankruptcy Court Issues Latest Decision Approving Plan with “Death Trap” [American Bankruptcy Institute Unsecured Trade Creditors Committee Newsletter]

May 01, 2017

Simon Fraser discusses a recent court decision in the American Bankruptcy Institute’s Unsecured Trade Creditors Committee Newsletter.

Delaware’s Anti-SLAPP Statute Limited to Land Use Disputes [Delaware Business Court Insider]

April 05, 2017

Mark Felger and Barry Klayman discuss a recent case from the Delaware Court of Chancery in The Delaware Business Court Insider.

U.S. Supreme Court Significantly Limits Structured Dismissals [Bankruptcy, Insolvency & Restructuring Alert]

March 27, 2017

Mark E. Felger and Gregory F. Fischer discuss the U.S. Supreme Court’s recent decision in Czyzewski v. Jevic Holding Corp., that structured dismissals must now either comply with the Bankruptcy Code’s basic priority scheme or have the consent of creditors that the structured dismissal seeks to avoid.

Dollar Cap on Committee Professional Fees Under Confirmed Plan [Delaware Business Court Insider]

March 08, 2017

Mark Felger and Barry Klayman discuss a case involving the effect of a DIP financing order cap on professional fees after a Chapter 11 plan is confirmed in the Delaware Business Court Insider. .

Directors Are Public Figures for Election-Related Communications Among Investors [Delaware Business Court Insider]

February 08, 2017

Mark Felger and Barry Klayman discuss a case of first impression from the Court of Chancery in The Delaware Business Court Insider.

Post-Confirmation Examinations Pursuant to Bankruptcy Rule 2004 [Delaware Business Court Insider]

January 18, 2017

Mark Felger and Barry Klayman discuss a recent bankruptcy court decision in The Delaware Business Court Insider.

Ninth Circuit Clarifies Which Landlord Claims are Subject to Section 502(b)(6) Cap [Bankruptcy, Insolvency & Restructuring Alert]

January 12, 2017

Mark E. Felger and Simon E. Fraser discuss a recent opinion from the Ninth Circuit that sets out a clear and seemingly easy to follow test to determine whether a given claim held by a landlord is subject to the cap section 502(b)(6) of the Bankruptcy Code imposes.

Turnover Order Cannot Trump Prohibition on Disclosure of ESI by Email Service Provider [Delaware Business Court Insider]

December 21, 2016

Mark Felger and Barry Klayman discuss a recent Delaware bankruptcy court decision regarding the federal Stored Communications Act.

Third Circuit Rules in Favor of Noteholders on Make-Whole Provision in Debt Indenture [Bankruptcy, Insolvency & Restructuring Alert]

November 21, 2016

Eric L. Scherling discusses a recent Third Circuit Court decision that held under the terms of the indentures governing the debtors’ issued notes, an “optional redemption” premium was payable to noteholders notwithstanding the automatic acceleration of the indebtedness upon bankruptcy pursuant to another provision of the indenture.

Bankruptcy Court Holds Class-Action Waiver in Arb Agreement Violates NLRA [Delaware Business Court Insider]

November 09, 2016

Mark Felger and Barry Klayman discuss a recent Delaware bankruptcy court decision in The Delaware Business Court Insider.

Vendor’s Reclamation Rights Survive Lien of Post-Petition DIP Loan [Delaware Business Court Insider]

October 12, 2016

Mark Felger and Barry Klayman discuss a recent Delaware bankruptcy court decision in The Delaware Business Court Insider.

Post-Confirmation Noncore Claim Defeats Bankruptcy Court Jurisdiction [Delaware Business Court Insider]

September 07, 2016

Mark Felger and Barry Klayman discuss a decision that limits jurisdiction over post-confirmation, noncore claims by the trustee of a liquidating trust.

Bankruptcy Judge Allows Filing of Class-Based Proof of Claim [Delaware Business Court Insider]

August 10, 2016

Mark Felger and Barry Klayman discuss a recent Delaware bankruptcy decision allowing the filing of a class-based proof of claim.

Third Circuit: Carrier’s “Extended” Maritime Possessory Liens Upheld [American Bankruptcy Institute Journal]

August 01, 2016

John Carroll and Simon Fraser discuss a U.S. Court of Appeals for the Third Circuit decision on maritime possessory liens in the American Bankruptcy Institute Journal.

Use of ‘Golden Share’ to Block Voluntary Bankruptcy Violates Federal Laws [Delaware Business Court Insider]

July 06, 2016

Mark Felger and Barry Klayman discuss a recent Delaware bankruptcy decision in their Delaware Business Court Insider article.

Champerty and Maintenance Redux [Delaware Business Court Insider]

June 08, 2016

Mark Felger and Barry Klayman discuss the status of champerty and maintenance actions in Delaware in their DBCI article, “Champerty and Maintenance Redux.”

Supreme Court Rejects Fear of ‘Super-Director’ [Delaware Business Court Insider]

May 11, 2016

Mark Felger and Barry Klayman discuss a Delaware Supreme Court case addressing the issue of honesty and fair dealing among directors.

Third Circuit Court of Appeals Upholds Carrier’s “Extended” Maritime Possessory Liens [Bankruptcy, Insolvency & Restructuring Alert]

May 09, 2016

Mark E. Felger and Simon E. Fraser discuss the U.S. Court of Appeals for the Third Circuit decision that maritime carriers and their customers may contractually extend the carrier’s common law possessory liens on cargo, securing payment of shipping charges, so as to cover not only the particular cargo for which shipping charges are outstanding, but all cargo belonging to the customer in the carrier’s possession.

Seventh Circuit Holds Pre-Bankruptcy Termination of Lease May Be Avoidable Transfer [Bankruptcy Insolvency & Restructuring Alert]

April 07, 2016

John T. Carroll, III and Keith L. Kleinman discuss the recent decision of In re Great Lakes Quick Lube LP, in which the Seventh Circuit held that the termination of a debtor’s leasehold interest pre-bankruptcy via a termination agreement is subject to being set aside as either a preferential and/or fraudulent transfer under the Bankruptcy Code.

Production of Metadata Ordered on Showing of Particularized Need [Delaware Business Court Insider]

April 06, 2016

Mark Felger and Barry Klayman discuss the showing of particularized need required to compel the production of metadata in The Delaware Business Court Insider.

Representing the Creditors' Committee: A Guide for Practitioners

March 31, 2016

Mark Felger co-authored and edited a practical guide on how to maximize the value of a debtor's assets as well as every step of the Chapter 11 process.

Judge Rejects Fee Defense Provisions in Retention Applications [Delaware Business Court Insider]

March 09, 2016

Mark Felger and Barry Klayman discuss two decisions from the U.S. Bankruptcy Court for the District of Delaware in the Delaware Business Court Insider.

Bankruptcy Court Disallows State of Oregon’s $29.3 Million Tax Claim [American Bankruptcy Institute Journal]

March 01, 2016

Simon Fraser discusses Oregon’s bankruptcy court tax claim in the American Bankruptcy Institute Journal.

Complex Unsettled Foreign Law Issues and Forum Non Conveniens [Delaware Business Court Insider]

February 17, 2016

Mark Felger and Barry Klayman discuss the impact of complex, unsettled issues of foreign law in the dismissal of cases on forum non conveniens grounds.

Third Circuit Holds Companies in Bankruptcy Can Reject Expired CBAs [Bankruptcy, Insolvency & Restructuring Alert]

February 08, 2016

Simon E. Fraser and George A. Voegele discuss a ruling from the U.S. Court of Appeals for the Third Circuit that comes as a blow to organized labor and a boon to employers in bankruptcy.

Superior Court Reaffirms Strong Public Policy In Favor of Arbitration

January 13, 2016

Mark Felger and Barry Klayman, both members of Cozen O’Connor’s Bankruptcy group, discuss mandatory arbitration provisions and a recent Delaware decision.

WARN Act Violation States Fiduciary Duty Breach [Delaware Business Court Insider]

December 09, 2015

Mark Felger and Barry Klayman, both members of Cozen O’Connor’s Bankruptcy group, discuss a recent case in which a judge came to the conclusion that a knowing violation of the law by a fiduciary is a breach of duty.

3d Circuit Bolsters Gifting [American Bankruptcy Institute Journal]

December 01, 2015

Simon Fraser discusses circuit-level opinions on gifting arrangements in an article in the American Bankruptcy Institute Journal.

Limiting Reach of Section 205: An Exercise in Statutory Interpretation [Delaware Business Court Insider]

November 11, 2015

Barry Klayman and Mark Felger discuss the Court of Chancery's recent decision limiting the scope of DGCL Section 205 to declaring the validity of, but not the invalidity of, a defective corporate act

A Cautionary Tale For Involuntary Bankruptcy Petitioners [Law360]

October 26, 2015

Barry Klayman discusses the recent decision by the U.S. Court of Appeals for the Third Circuit in In re: Forever Green Athletic Fields Inc., which held that an involuntary bankruptcy petition filed under 11 U.S.C. § 303 may be dismissed for bad faith.

3rd Circuit Affirms Bad Faith Involuntary Bankruptcy Dismissal Increasing Risk of Punitive Damages [Bankruptcy, Insolvency & Restructuring Alert]

October 19, 2015

The decision places another hurdle for creditors to surmount when considering whether to put a debtor in bankruptcy and creates another means for debtors to oppose such filings. It also enumerates the standard for evaluating whether a filing is in bad faith.

Chancery Rejects Controller's Conspiracy Claims [Delaware Business Court Insider]

October 14, 2015

Barry M. Klayman and Mark E. Felger published an article in the Delaware Business Court Insider discussing the finding that the plaintiffs' conduct was "prejudicial to the administration of justice" in the OptimisCorp v. Waite case.

Advancement Claims Not Entitled to Priority in LLC Receivership [Delaware Business Court Insider]

September 09, 2015

Barry M. Klayman and Mark E. Felger published an article in the Delaware Business Court Insider discussing the cases of Andrikopoulos v. Silicon Valley Innovation LLC and Henson v. Sousa. The main dispute between the parties in both cases was whether, in the context of LLC receiverships under Delaware law, advancement claims are administrative expenses or unsecured creditor claims.

Forum Selection Clause Held Waiver of Removal Right [Delaware Business Court Insider]

August 12, 2015

Barry M. Klayman and Mark E. Felger published an article in the Delaware Business Court Insider discussing the case of Interdigital v. Wistron, which answers the question of whether a forum selection clause in an agreement constitutes a waiver of a party’s right to remove the case to federal court if the other party files suit in a Delaware state court.

The Supreme Court Affirms Bankruptcy Court Jurisdiction for “Stern” Claims Based Upon Implied Consent [ABA Business Bankruptcy Committee Newsletter]

July 31, 2015

Mark Felger and Keith Kleinman discuss the Supreme Court’s decision in Wellness Int’l Network, Ltd. v. Sharif, in which it was affirmed that bankruptcy courts have jurisdiction to issue final judgments on Stern claims if the parties consent to the bankruptcy court adjudicating such claims.

Derivative Standing in Bankruptcy Proceedings [Delaware Business Court Insider]

July 07, 2015

Barry M. Klayman and Mark E. Felger, members in the firm's Wilmington office, published an article in the Delaware Business Court Insider discussing the case of In re Optim Energy LLC (Walnut Creek Mining v. Cascade Investment LLC) and why the opinion in this case is noteworthy.

Section 220 Demand Doesn't Extend to Non-employee Directors' Private Email [Delaware Business Court Insider]

June 10, 2015

Barry M. Klayman and Mark E. Felger, members in the firm's Wilmington office, published an article in the Delaware Business Court Insider discussing the case of In re Lululemon Athletica 220 Litigation and whether a corporation can search the personal email accounts of its non-employee directors under Section 220.

Supreme Court Affirms Bankruptcy Court Jurisdiction and 3rd Circuit Approves Structured Dismissals [Bankruptcy, Insolvency & Restructuring Alert]

June 04, 2015

The U.S. Supreme Court affirms jurisdiction of Bankruptcy Courts to enter final judgment on “Stern Claims” based on consent of parties; 3rd Circuit affirms approval of structured dismissals that violate absolute priority rule.

Automatic Stay Doesn't Apply to Right to Compel Annual Meeting [Delaware Business Court Insider]

May 13, 2015

Barry M. Klayman and Mark E. Felger, members in the firm's Wilmington office, published an article in the Delaware Business Court Insider titled ''Automatic Stay Doesn't Apply to Right to Compel Annual Meeting.'' The article discusses the case of In re SS Body Armor I and if a stockholder has the right to compel a debtor to hold an annual meeting for the purpose of electing a new board of directors continues during the pendency of a Chapter 11 proceeding, and that the automatic stay does not apply to the exercise of that right.

Non-signatory May Enforce Forum Selection Clause to Defeat Removal [Delaware Business Court Insider]

April 08, 2015

Barry M. Klayman and Mark E. Felger, members in the firm's Wilmington office, published an article in the Delaware Business Court Insider titled "Non-signatory May Enforce Forum Selection Clause to Defeat Removal." The article discusses the case of Carlyle Investment Management LLC v. Moonmouth, and how the case can be instructive for its application of Delaware law to the question of when a non-signatory to an agreement will be bound by its forum selection clause and whether the forum selection clause can be enforced by another non-signatory.

Delaware Bankruptcy Court Applies “Unforeseeable Business Circumstances Exception” and Holds that Estate Has No WARN Act Liability [American Bankruptcy Institute Unsecured Trade Creditors Committee Newsletter]

March 17, 2015

When a business is in financial distress, the breaking point sometimes comes with little or no warning. An event such as a termination of funding, the falling through of a crucial transaction, or the loss of a key customer can be difficult to predict, and may result in a distressed business being forced to cease operations abruptly, without providing its workers with the advance notice required under the Federal WARN Act.

Court Adopts Narrow View of Exception to Borrowing Statute [Delaware Business Court Insider]

March 10, 2015

Barry M. Klayman and Mark E. Felger, members in the firm's Wilmington office, published an article in the Delaware Business Court Insider titled "Court Adopts Narrow View of Exception to Borrowing Statute." The article discusses Delaware's borrowing statute and statute of limitations, and specifically the case of Saudi Basic Industries v. Mobil Yanbu Petrochemical, 866 A.2d 1 (Del. 2005).

Fiduciary Duty Claims Held Non-core and Subject to Jury Trial [Delaware Business Court Insider]

February 10, 2015

Barry M. Klayman and Mark E. Felger, members in the firm's Wilmington office, published an article in the Delaware Business Court Insider titled "Fiduciary Duty Claims Held Non-core and Subject to Jury Trial." The article discusses whether or not claims for breach of fiduciary duty are aiding and abetting breach of fiduciary duty against an officer and director of a debtor core proceedings, and whether those claims are subject to trial by jury.

Proceeds of Insurance Policy Are Property of Estate [Delaware Business Court Insider]

January 14, 2015

Barry M. Klayman and Mark E. Felger, members in the firm's Wilmington office, published an article in the Delaware Business Court Insider titled ''Proceeds of Insurance Policy Are Property of Estate.'' This article discusses the case of Chartis Specialty Insurance v. Tri-Valley (In re Tri-Valley), Adv. No. 12-51243 (MFW) (Bankr. D. Del. Nov. 25, 2014) and third-party insurance policies in bankruptcy cases.

Chancery Court Addresses Section 220 Demands on Close Corporations [Delaware Business Court Insider]

December 03, 2014

Barry M. Klayman and Mark E. Felger, members in the firm's Wilmington office, published an article in the Delaware Business Court Insider titled '''Chancery Court Addresses Section 220 Demands on Close Corporations.'' This article discusses Jefferson v. Dominion Holdings and the principles of Section 220.

'Ministerial Acts' Exception Applies to Corrected Judgment Order [Delaware Business Court Insider]

November 12, 2014

Barry M. Klayman and Mark E. Felger, members in the firm's Wilmington office, published an article in the Delaware Business Court Insider titled, '''Ministerial Acts' Exception Applies to Corrected Judgment Order.'' This article discusses the Delaware Superior Court's recent decision in Universal Music Investments v. Exigen Ltd., C.A. No. N13C-10-300-FSS (Del. Super. Aug. 25, 2014), which explores the effect of the automatic bankruptcy stay on an order correcting a mistake in a prior order. The decision also discussed whether a guarantor is in privity with the primary obligor for res judicata purposes.

Potential Claimants Get 'Redo' on Adequacy of Bar Date Notice [Delaware Business Court Insider]

October 08, 2014

What constitutes constitutionally adequate notice to a debtor's unknown creditors of the deadline for filing proofs of claim? In White v. Jacobs (In re New Century TRS Holdings), Civ. No. 13-1719-SLR (D. Del. Aug. 19, 2014), the U.S. District Court for the District of Delaware concluded that the adequacy of the notice provided to unknown creditors had not been meaningfully explored by the bankruptcy court and likely was not reasonably calculated to apprise them of the bar date.

Claims of Branding, Acquisition and Control Satisfy Single-Employer Test [Delaware Business Court Insider]

September 10, 2014

The Worker Adjustment and Retraining Notification Act (WARN Act) was enacted in 1988 to allow workers to adjust to the prospective loss of employment from a plant closing or mass layoff. It requires employers to give affected employees 60 days' advance notice of such events. Employers that violate the WARN Act's notice requirements are liable to the affected workers for each day that notice is not provided up to 60 days. Often, however, plant closings and mass layoffs presage an employer's demise, so workers look to affiliates of the employer, such as a solvent parent or lender, to show that they acted as a "single employer" in making the termination decision and share liability for the WARN Act violation.

Fee Award Nixed After Client Abandons Case [Delaware Business Court Insider]

August 13, 2014

In a neat, short opinion, the Delaware Supreme Court dealt with a situation that the chief justice characterized as "Kafkaesque" at oral argument and "unusual" in the written opinion. In Crothall v. Zimmerman, No. 608, 2013 (Del. June 9, 2014), the court reversed a fee award to plaintiffs’ counsel who had personally intervened in the case below solely for the purpose of seeking attorney fees for the work he had performed in the litigation after the plaintiff had abandoned the lawsuit prior to the entry of a final judgment. The court held that the plaintiff's former counsel did not create a corporate benefit and was not entitled to attorney fees because the plaintiff did not obtain an authoritative ruling of the Court of Chancery that could create a corporate benefit.

Confidentiality Orders in a Books-and-Records Inspection, Part II [Delaware Business Court Insider]

July 15, 2014

In part I of this article, we discussed how in Quantum Technology Partners IV L.P. v. Ploom, C.A. No. 9054-ML (Del. Ch. May 14, 2014) (Master's Final Report), Master in Chancery Abigail M. LeGrow faced the "unwelcome task" of finding an appropriate middle ground between the extreme positions taken by the parties in a Section 220 action concerning what terms should be included in a confidentiality order in connection with the inspection of corporate books and records where inspection was sought in part to assist the stockholder in marketing its shares.

Confidentiality Orders in a Books-and-Records Inspection, Part I [Delaware Business Court Insider]

July 09, 2014

A minority stockholder in a privately held corporation makes a demand to inspect the books and records of the corporation under Section 220 of the Delaware General Corporation Law. The stockholder states that the purpose of the inspection is to value his shares and to explore a possible sale of the stock. The corporation offers to provide some, but not all, of the requested documents.

Chancery Court Clarifies When Counterclaims Are Advanceable [Delaware Business Court Insider]

June 11, 2014

Harry Pontone, a former officer and director of The York Group and its subsidiary, Milso Industries, was a defendant in an action brought by the two companies and their parent company in federal court in Pennsylvania. The Pennsylvania plaintiffs alleged that Pontone, while still employed by York and Milso, participated in a wrongful scheme to induce several of their employees and many of their customers to switch to their main competitor. They alleged that these actions violated Pontone's employment agreement, which included express noncompete and nonsolicitation covenants, as well as the common law. The Pennsylvania plaintiffs asserted numerous claims against Pontone, including claims for breach of contract, breach of fiduciary duty, tortious interference with contractual relations, unfair competition, and unjust enrichment.

'Own Counsel' Defense Rejected in Awarding Class Counsel Fees [Delaware Business Court Insider]

May 14, 2014

Can a party that retains its own counsel be liable to pay a fee to another party's counsel or to class counsel? The answer, according to the recent Court of Chancery opinion in Smith, Katzenstein & Jenkins v. Fidelity Management & Research, C.A. No. 8066-VCL (Del. Ch. April 16, 2014), is a resounding yes. The court rejected the defendants' "own counsel" defense in an action to recover attorney fees and costs for benefits conferred as a result of the plaintiffs' prosecution and settlement of a class action as contrary to longstanding Delaware precedent dealing with shared causation in the award of fees and expenses when an attorney creates a common fund for, or confers a common benefit upon, a readily ascertainable group.

Superior Court: Champerty, Maintenance 'Alive and Well in Delaware' [Delaware Business Court Insider]

April 23, 2014

The doctrines of champerty and maintenance live on in Delaware, at least for the time being. In Charge Injection Technologies v. E.I. du Pont de Nemours & Co., C.A. No. N07C-12-134-JRJ (Del. Super., Feb. 27, 2014), interlocutory appeal refused, No. 160, 2014 (Del. Apr. 7, 2014), the Superior Court considered whether the doctrines of champerty and maintenance are dead in Delaware and held that, absent a ruling to that effect from the Delaware Supreme Court, it would continue to recognize the doctrines.

Third Circuit Holds That Purchaser of Claim Is Subject to § 502(d) of the Bankruptcy Code [American Bankruptcy Institute Unsecured Trade Creditors Committee Newsletter]

April 15, 2014

Simon Fraser discusses the decision in In re KB Toys Inc., in which the Third Circuit Court of Appeals held that a claim subject to disallowance under § 502(d) of the Bankruptcy Code in the hands of the original holder is also subject to disallowance in the hands of a purchaser.

The Interpretation of Contractual Survival Clauses [Delaware Business Court Insider]

March 12, 2014

Barry Klayman and Mark Felger, members of Cozen O'Connor's Bankruptcy, Insolvency & Restructuring Department, continue their discussion of the interpretation of survival clauses for contractual representations and warranties under Delaware law with a second article on the subject in The Delaware Business Court Insider. They note the court's surprising view on reps and warranties that the parties expressly agree are to survive indefinitely.

Application of Sovereign Immunity in Bankruptcy Actions [The Legal Intelligencer]

February 19, 2014

The U.S. Court of Appeals for the Seventh Circuit has ruled in favor of an unprecedentedly broad application of sovereign immunity in bankruptcy-related actions in its recent opinion, In re Equipment Acquisition Resources, 2014 U.S. App. LEXIS 2141 (Feb. 4, 2014). The court held that a debtor-in-possession cannot bring an Illinois fraudulent-transfer claim against the Internal Revenue Service (IRS) because its creditors could not bring such a claim against the IRS under state law due to sovereign immunity.

Interpretation of Contractual Survival Clauses Under Del. Law [Delaware Business Court Insider]

February 18, 2014

Agreements, especially acquisition agreements, typically contain representations and warranties by one party to the other. The agreements also typically prescribe the duration of those representations and warranties in so-called survival clauses. The treatment of these clauses under Delaware law may surprise many practitioners. In GRT v. Marathon GTF Technology Ltd., C.A. No. 5571-CS (Del. Ch. Jul. 11, 2011), Delaware Chancery Court Chancellor Leo E. Strine Jr. held that a clause limiting the period of time in which contractual representations and warranties survive closing acts as a statute of limitations on the buyer's ability to commence litigation f or breach.

Delaware Court Provides Guidance Regarding Tax-Sharing Agreements [American Bankruptcy Institute Journal]

February 03, 2014

Simon Fraser discusses the importance of specificity in tax-sharing agreements after a U.S. Bankruptcy Court for the District of Delaware ruling.

The Reanimation of a Dissolved Delaware Corporation [Delaware Business Court Insider]

January 16, 2014

When does the life of a Delaware corporation end? Not as long as there are third-party claimants with claims to assert and undistributed assets available to satisfy them. In Anderson v. Krafft-Murphy, No. 85, 2013 (Del. Nov. 26, 2013), asbestos tort claimants in lawsuits pending in other jurisdictions against Krafft-Murphy Co., a dissolved Delaware corporation, sought the appointment of a receiver to enable them to lawfully pursue their claims against the corporation in those other courts beyond the statutory three-year winding-up period. The Court of Chancery had granted summary judgment in favor of the corporation, holding that claims filed more than 10 years after the date of dissolution were time-barred and should be dismissed, and claims filed less than 10 years after the date of dissolution could proceed without a court-appointed receiver.

No Safe Harbor Protection for Triangular Setoff Under Swap Agreement [Delaware Business Court Insider]

December 18, 2013

Does the Bankruptcy Code allow for triangular setoffs in swap and repurchase agreements after commencement of the debtor's bankruptcy case? In Sass v. Barclays Bank (In re American Home Mortgage Holdings), Adv. Proc. No. 11-51851 (CSS) (Del. Bankr. Nov. 8, 2013), the court held that the Bankruptcy Code does not allow parties to set off non-mutual obligations, regardless of whether the agreements are subject to the safe harbor provisions of 11 U.S.C. §§ 559-661.

Electricity Not a Good for Administrative Priority Claims [Delaware Business Court Insider]

November 13, 2013

Is electricity a good for purposes of establishing an administrative priority claim under Section 503(b)(9) of the U.S. Bankruptcy Code? That is the question that U.S. Bankruptcy Judge Christopher Sontchi of the District of Delaware answers in In re NE Opco, Case No. 13-11483 (CSS) (Bankr. D. Del. Nov. 1, 2013). Faced with a split in authority from other jurisdictions and no written opinions on the subject in the U.S. Court of Appeals for the Third Circuit, Sontchi, in a fascinating opinion, holds that electricity is not a good for purposes of Section 503(b)(9).

Dismissal of 'Litigation Tactic' Bankruptcy Cases [The Legal Intelligencer]

October 21, 2013

It is the morning of a scheduled sheriff’s sale. Following several months, and many thousands of dollars of expense, spent in obtaining a judgment, providing the requisite notices and executing on its lien, a secured creditor is finally nearing its recovery of at least a portion of its claim, through a real property foreclosure. One hour before the scheduled sale, however, the creditor’s phone rings. It is the sheriff, calling to report that the sale has been postponed. A copy of a bankruptcy petition, filed just that morning, has been faxed to the sheriff on the property owner’s behalf. The sheriff cannot move forward with the sale in the face of this last-minute development, leaving the creditor with little to show for its time and money, other than the promise of additional months’ aggravation and delay ahead.

To WARN or Not to WARN [American Bankruptcy Institute Unsecured Trade Creditors Committee Newsletter]

October 01, 2013

Cozen O'Connor's Simon Fraser, member of the Bankruptcy, Insolvency & Restructuring Group, discusses the implications of the "unforeseeable business circumstances" exception to WARN Act liability.

Laches Decision Reversed 'in the Interest of Justice' [Delaware Business Court Insider]

September 11, 2013

It is not often that the Delaware Supreme Court rejects the specific arguments advanced by an appellant and then decides the matter in the party's favor on grounds not asserted by that party but considered sua sponte by the court. Such was the case in Levey v. Brownstone Asset Management, LP, No. 551, 2012 (Del. Aug. 27, 2013), wherein the court reversed the decision of the Court of Chancery and remanded for further proceedings "in the interest of justice."

Relations-Back Doctrine Applied in Adversary Actions [Delaware Business Court Insider]

August 15, 2013

Two recent bankruptcy cases decided on the same day by the same judge dealt with motions to amend the complaints in preference actions. Both cases illustrate the court's application of the relation-back doctrine, with differing results. Along the way, the court addressed the requirements for proper service and equitable tolling of the statute of limitations

Single Employer Test Emphasizes De Facto Control Factor [Delaware Business Court Insider]

July 10, 2013

Barry Klayman and Mark Felger of the Wilmington office authored an article titled, "Single Employer Test Emphasizes De Facto Control Factor," in the most recent edition of The Delaware Business Court Insider. The article discusses two recent decisions from the Delaware district and bankruptcy courts on a parent corporation's liability under the federal WARN Act for a subsidiary's failure to provide advance notice of employee layoffs. To read the full article, click here.

Definition of Property Limited Under Bankruptcy Code [Delaware Business Court Insider]

June 12, 2013

Barry Klayman and Mark Felger discuss the recent bankruptcy court decision in The Majestic Star Casino LLC v. Barden Development, specifically the case's expansive view of what constituted property of the debtor's estate.

Courts Recharacterizing Insider 'Loans' as Equity [The Legal Intelliencer]

May 14, 2013

In an opinion issued April 30, In re Fitness Holdings International, 2013 U.S. App. LEXIS 8729, the U.S. Court of Appeals for the 9th Circuit joined a number of other circuit courts in recognizing the authority of courts to recharacterize purported debt owed by a corporation as equity.

Summary Judgment Motion Not Preceded by Motion to Compel Akin to Trial by Ambush [Delaware Business Court Insider]

March 13, 2013

On January 2, the Delaware Supreme Court issued a trilogy of cases dealing generally with the issue of whether a case should be dismissed for the attorneys' failure to obey scheduling orders.

Bankruptcy Court for District of Delaware Approves Use of Post-Petition Lock-Up Agreements and Permits Release of Non-debtor Parties by Non-voting Creditors [Bankruptcy, Insolvency and Restructuring Alert]

February 22, 2013

The Delaware Bankruptcy Court recently issued an opinion in the Indianapolis Downs Chapter 11 case that is worth reading in its entirety for its impact on numerous plan confirmation issues. This article will address the court's endorsement of post-petition lock-up agreements and, secondarily, the court's approval of a plan's third-party release provision that provides for the deemed consent of non-voting creditors.

Third Circuit Broadly Defines IP Licenses [The Legal Intelligencer]

February 11, 2013

The U.S. Court of Appeals for the Third Circuit recently affirmed its expansive definition of what constitutes an intellectual property license in In re Spansion. The Third Circuit clarified that a license need not be expressly labeled as such or formally grant intellectual property rights, but instead is a mere waiver by the holder of intellectual property of its right to sue.

Third Circuit Protects Post-Confirmation Appeal Rights

October 19, 2012

The U.S. Court of Appeals for the Third Circuit recently addressed the tension that may exist between the needs of a bankrupt debtor attempting to reorganize and the rights of nondebtor litigants in In re Philadelphia Newspapers, 2012 U.S. App. LEXIS 15419 (3d Cir. July 26, 2012).

Third Circuit Extends Grossman's Test for when a 'Claim' Arises but Declines Discharge of Claims on Due Process Grounds [Bankruptcy, Insolvency & Restructuring Alert]

June 29, 2012

Third Circuit Extends Grossman's Test for when a 'Claim' Arises but Declines Discharge of Claims on Due Process Grounds - Bankruptcy, Insolvency & Restructuring Alert - Confirmation of a plan of reorganization generally discharges all pre-confirmation “claims.” However, in some instances, a plaintiff’s claim against a debtor does not manifest itself until after a plan has already been confirmed.

Eleventh Circuit Expands Fraudulent Transfer Liability in Tousa Decision [Bankruptcy, Insolvency & Restructuring Alert]

May 23, 2012

Eleventh Circuit Expands Fraudulent Transfer Liability in Tousa Decision - Bankruptcy, Insolvency & Restructuring Alert - In a decision that may greatly expand the level of due diligence required of creditors seeking payment from distressed debtors, on May 15, 2012 the U.S. Court of Appeals for the 11th Circuit (the Circuit Court) issued an opinion in In re TOUSA, Inc. that affirmed the original decision of the U.S. Bankruptcy Court...

Bankruptcy Court for the District of Delaware Denies Cramdown of Liquidating Plan Because Approving Classes Were "Artificially Impaired" [Bankruptcy, Insolvency & Restructuring Alert!]

April 11, 2012

Bankruptcy Court for the District of Delaware Denies Cramdown of Liquidating Plan Because Approving Classes Were "Artificially Impaired" - Bankruptcy, Insolvency & Restructuring Alert! - When a debtor is unable to obtain acceptance of its chapter 11 plan of reorganization or liquidation by all impaired creditor classes, it may attempt to “cramdown” the plan upon certain rejecting classes.1 One of the requirements in
order to obtain confirmation of a plan through a cramdown is that at least one class of impaired claims must approve the plan, determined without including the votes of insider creditors.

The Duty of Chapter 7 Trustees to Perform Obligations of an ERISA Plan Administrator: Jurisdictional and Practical Considerations [Inside the Minds]

March 18, 2012

The Duty of Chapter 7 Trustees to Perform Obligations of an ERISA Plan Administrator: Jurisdictional and Practical Considerations - Inside the Minds - Bankruptcy trustees are fiduciaries. A Chapter 7 trustee’s primary obligation is to “collect and reduce to money the property of the estate for which such trustee serves, and close such estate as expeditiously as is compatible with the best interests of parties in interest[.]” 11 U.S.C. § 704(a)(1) (2012). As an officer of the court and as a representative of a debtor’s creditors, the trustee has a duty to protect and preserve estate property, and to realize the maximum return for...

Delaware Bankruptcy Court Expounds on Meaning and Significance of Stern [Delaware Business Court Insider]

January 18, 2012

Delaware Bankruptcy Court Expounds on Meaning and Significance of Stern - Delaware Business Court Insider -

Bankruptcy Court Asserts Jurisdiction to Determine Debtor's State Tax Liability [Delaware Business Court Insider]

November 23, 2011

Bankruptcy Court Asserts Jurisdiction to Determine Debtor's State Tax Liability - Delaware Business Court Insider - At a time when practitioners debate the reach of bankruptcy court jurisdiction, the Delaware court continues to assert its jurisdiction in the face
of new challenges. In In re Indianapolis Downs LLC, the U.S. Bankruptcy Court for the District of Delaware held that it had jurisdiction to decide whether a state taxing authority could continue to collect a state tax on part
of the debtor’s revenue from slot-machine wagering. In doing so, the court turned back

Affirming Creditor's Lack of Derivative Standing, Supreme Court Underscores Plain Meaning of LLC Act [Delaware Business Court Insider]

September 21, 2011

Affirming Creditor's Lack of Derivative Standing, Supreme Court Underscores Plain Meaning of LLC Act - Delaware Business Court Insider - Earlier this month, in CML V LLC v. Bax, the Delaware Supreme Court held that a creditor of an insolvent limited liability company lacks standing under the Delaware Limited Liability Company Act to bring a derivative action against the LLC's former managers. In so doing, the court gave effect to the plain meaning of the LLC Act and drew a sharp distinction between the rights of creditors of insolvent LLCs and those of creditors of insolvent corporations.

Bankruptcy Court Rejects Challenge to Personal Jurisdiction in Preference Case [Delaware Business Court Insider]

July 13, 2011

Bankruptcy Court Rejects Challenge to Personal Jurisdiction in Preference Case - Delaware Business Court Insider - In a June 22 decision in a case of first impression, the Delaware Bankruptcy Court turned back a due process challenge to the exercise of the court's personal jurisdiction over a preference defendant. In In re DBSI Inc., the trustee sought to avoid and recover pre‐petition transfers made to various insiders and
pre‐petition transfers made on behalf of the insiders to the IRS and other taxing authorities.

Bankruptcy Court Rejects Bright- Line Rule for Substantially Contemporaneous Exchange [Delaware Business Court Insider]

June 21, 2011

Bankruptcy Court Rejects Bright- Line Rule for Substantially Contemporaneous Exchange - Delaware Business Court Insider - Bankruptcy Court Judge Kevin Gross, in In re J. Silver Clothing Inc., a 2011 case
out of the District of Delaware, rejected an argument that the 10-day (now 30-
day) period in Bankruptcy Code Section 547(e)(2) provides a bright-line limit as
to whether a transfer is "substantially contemporaneous"

Bankruptcy filings dip [Philadelphia Business Journal]

May 20, 2011

Bankruptcy filings dip - Philadelphia Business Journal - Local Chapter 11 business bankruptcy filings fell close to pre-recession numbers in the first quarter after spiking dramatically between late 2008 through the middle of last year. But a second wave of filings could come if interest rates rise without being accompanied by significant economic improvement, analysts and bankruptcy lawyers say. Business Chapter 11 filings in New Jersey and the Eastern District of

Controversial Fraudulent Conveyance Decision in Tousa Reversed [Bankruptcy, Insolvency & Restructuring Alert!]

February 18, 2011

Controversial Fraudulent Conveyance Decision in Tousa Reversed - Bankruptcy, Insolvency & Restructuring Alert! - In what has validated lenders’ belief in the propriety of a parent corporation’s borrowing based in part on the parent company’s guarantees and assets of its operating subsidiaries, the United States District Court for the Southern District of Florida, on February 11, 2011, reversed the controversial Southern District of Florida Bankruptcy Court’s decision in In re TOUSA, Inc., which dramatically expanded the powers of a bankruptcy trustee to set aside as a

Retirees Find that Employer's Bankruptcy May Be a Good Thing [Bankruptcy, Insolvency & Restructuring Alert!]

July 26, 2010

Retirees Find that Employer's Bankruptcy May Be a Good Thing - Bankruptcy, Insolvency & Restructuring Alert! - In deciding a question never before addressed by a circuit level court, the U.S. Court of Appeals for the Third Circuit, in In re Visteon, No. 10-1944 (July 13, 2010), held that the plain language of section 1114 of the Bankruptcy Code forbids a debtor from modifying or terminating retiree benefits without first complying with that section’s procedural and substantive safeguards

Third Circuit Remands Case Involving Use of In Pari Delicto Defense by Outside Auditors, After Receiving Pennsylvania Supreme Court's Guidance [Bankruptcy, Insolvency & Restructuring Alert!]

June 03, 2010

Third Circuit Remands Case Involving Use of In Pari Delicto Defense by Outside Auditors, After Receiving Pennsylvania Supreme Court's Guidance - Bankruptcy, Insolvency & Restructuring Alert! - In a February 19, 2010 Alert, we reported on an opinion of the Pennsylvania Supreme Court regarding the use of an imputation-based in pari delicto defense in an auditor-liability context, an issue of first impression under Pennsylvania law. Off. Comm. of Unsecured Creditors of Allegheny Health Educ. & Research Fund v. PricewaterhouseCoopers, LLP (“Allegheny III”), 989 A.2d 313 (Pa. 2010).

Spring 2010 [Business Law Observer]

April 19, 2010

This Spring edition highlights many pertinent issues confronting a business owner in the 21st century. In the wake of unprecedented economic trouble, our lead article discusses how to protect your business from preference exposure when a customer goes bankrupt.

Pennsylvania Supreme Court Restricts Use of In Pari Delicto Defense by Outside Auditors [Bankruptcy, Insolvency & Restructuring Alert!]

February 19, 2010

Pennsylvania Supreme Court Restricts Use of In Pari Delicto Defense by Outside Auditors - Bankruptcy, Insolvency & Restructuring Alert! - On February 16, 2010, the Pennsylvania Supreme Court issued an opinion of first impression under Pennsylvania law as to whether an imputation-based in pari delicto defense in an auditor-liability context may be asserted.

An Overview of Key Amendments to the Bankruptcy Code [The Bankruptcy Abuse and Consumer Protection Act of 2005]

January 04, 2006

An Overview of Key Amendments to the Bankruptcy Code - The Bankruptcy Abuse and Consumer Protection Act of 2005 -

Events & Seminars

Past Events

Bankruptcy Trends in Sales and Restructuring

August 02, 2019 - Hershey, PA

Sophisticated Deposition Strategies

November 19, 2015 - Wilmington, DE

11th Annual Mid-Atlantic Bankruptcy Workshop

August 07, 2015 - Hershey, PA

13th Annual TMA Mid-Atlantic Regional Symposium

June 10, 2015 - Atlantic City, NJ

21st Annual Central States Bankruptcy Workshop

June 12, 2014 - Lake Geneva, Wisconsin

In The News

Cozen O’Connor Recognized As a Best Law Firm in 25 Practice Areas Nationwide, 106 Practice Areas Regionally

November 05, 2019

The U.S. News – Best Lawyers “Best Law Firms” rankings are based on a rigorous evaluation process that includes the collection of client and lawyer evaluations and peer review from leading attorneys in their field.

17 Cozen O’Connor Attorneys Recognized as New York Super Lawyers and Rising Stars

September 27, 2019

Super Lawyers has named 17 Cozen O'Connor attorneys to its 2019 New York Super Lawyers and Rising Stars list.

138 Cozen O’Connor Attorneys Named to the Best Lawyers in America

August 28, 2019

Best Lawyers selected 138 Cozen O’Connor lawyers from 21 of the firm’s national offices for inclusion in the 2020 edition of The Best Lawyers in America.

Payment of Discretionary Bonus Not a Per Se Fraudulent Conveyance [Delaware Business Court Insider]

June 05, 2019

Barry Klayman and Mark Felger discuss a recent case from the Delaware Bankruptcy Court holding that the payments by debtors of discretionary bonuses, not tied to previously enunciated metrics and while the debtors were insolvent, were not per se fraudulent conveyances under the Bankruptcy Code in an article in the Delaware Business Court Insider.

57 Cozen O’Connor Lawyers, 16 Practices Earn Top Recognition in Chambers USA 2019 Guide

April 25, 2019

Chambers USA, the leading annual guide to the top lawyers and law firms in the USA, has ranked 57 Cozen O’Connor lawyers as leaders in their respective fields in the Guide’s 2019 edition.

Cozen O’Connor Appointed to Oversee Creditors’ Committee for Warrior Golf Reorganization

April 03, 2019

Warrior filed voluntary petitions for Chapter 11 relief in the U.S. Bankruptcy Court for the Southern District of Texas Laredo Division to facilitate its reorganization. During this time, its custom golf business and nationwide portfolio of public courses remain open for business.

Cozen O’Connor Oversees Bankruptcy Acquisition of New York-based Luxury Coffee Chain FIKA

January 22, 2019

Attorney Frederick E. Schmidt, Jr. Guides Senior Secured Lender Through a Complex Chapter 11 Section 363 Sale

126 Cozen O’Connor Attorneys Named to the Best Lawyers in America

August 22, 2018

One hundred twenty-six Cozen O’Connor lawyers from 20 of the firm’s national offices have been selected for inclusion in the 2018 edition of The Best Lawyers in America.

Former Deputy Attorney General and Bankruptcy Litigator Thomas J. Francella Jr. Joins Cozen O’Connor’s Wilmington, Delaware Office

July 10, 2018

Highly Regarded Throughout the Legal Community, Francella Brings Substantial Federal- and State-Level Bankruptcy Litigation Experience

Fifty Cozen O’Connor Attorneys Ranked by Chambers USA 2018

May 21, 2018

Cozen O’Connor is pleased to announce that Chambers USA has recognized 50 Cozen O’Connor attorneys for 2018 as leaders in their respective fields; 12 attorneys were recognized nationally and 14 were ranked in the top band either nationally or at the state level.

Cozen O’Connor Elects 19 Associates to Membership

April 09, 2018

Cozen O’Connor has elected 19 associates to membership in the firm. The management committee appointed this qualified group of attorneys to membership based on demonstrated professionalism, leadership, dedication, and loyalty to Cozen O’Connor.

2018 U.S. News & World Report – Best Lawyers "Best Law Firms" Ranks Cozen O’Connor

February 01, 2018

In the 2018 U.S. News - Best Lawyers® "Best Law Firms, Cozen O’Connor is ranked nationally in 17 practice areas and regionally in 64 practice areas.

100 Cozen O’Connor Lawyers Named to the Best Lawyers in America

August 23, 2017

Lawyers were selected for inclusion in the 2018 edition based on a rigorous peer-review that has been developed and defined for more than 30 years.

Cozen O'Connor Bankruptcy Attorneys Receive Court Approval for Sale of Unilife

July 19, 2017

Mark Felger, in conjunction with Erik Schmidt and Keith Kleinman, received court approval for three sale transactions for Unilife Corp., a company which makes wearable medication devices.

Cozen O'Connor ranked in 2017 U.S. News & World Report – Best Lawyers "Best Law Firms"

November 23, 2016

Firms included in the 2017 "Best Law Firms" list are recognized for professional excellence with persistently impressive ratings from clients and peers.

Sixty-Two Cozen O’Connor Lawyers Named to the Best Lawyers in America

August 15, 2016

Sixty-two Cozen O’Connor lawyers from 13 of the firm’s national offices have been selected for inclusion in the 2017 edition of The Best Lawyers in America.

Cozen O’Connor Earns Client Recognition in 2016 Chambers USA Rankings

May 27, 2016

Chambers USA recognized 41 Cozen O’Connor lawyers as leaders in their respective fields; 12 attorneys were recognized nationally and 11 were ranked in the top band.

Cozen O’Connor Earns Client Recognition in 2015 Chambers USA Rankings

July 06, 2015

Chambers USA recognized 37 Cozen O’Connor lawyers as leaders in their respective fields; 12 attorneys were recognized nationally and 10 were ranked in the top band.

Cozen O’Connor Expands Bankruptcy Practice with Hiring of Schmidt

March 02, 2015

Cozen O’Connor is pleased to announce that it has expanded its Bankruptcy, Insolvency, and Restructuring Practice Group with the hiring of Frederick E. (Erik) Schmidt, Jr. as a member. Eric was previously a partner with Herrick, Feinstein’s Bankruptcy and Corporate Restructuring Group.