By Wendy M. Simkulak and Brad Lenox
In Mendelsohn v. Dole Fresh Fruit Co. (In re Barnett Corp.), the Bankruptcy Court for the Eastern District of New York conditionally granted an adversary proceeding defendant’s motion to dismiss a complaint asserting, among other things, federal and state fraudulent transfer claims on the basis that the plaintiff failed to meet federal pleading standards.
By Lawrence J. Kotler and Hunter C. Blume
In a recent decision, the U.S. Court of Appeals for the Third Circuit, in the case of In re Alecto Healthcare Services LLC, issued a precedential opinion affirming a debtor’s eligibility to proceed under Subchapter V of Chapter 11 and the ability of a debtor to confirm a reorganization plan that settled potential fraudulent transfer claims against the debtor’s insiders. The decision is notable for its treatment of when a debt is “contingent” and “unliquidated” for purposes of the Subchapter V debt limit and the deferential standard governing bankruptcy court approval of insider settlements over creditor objections.
By James Billingsley and Geoffrey A. Heaton
When a loan goes into default, one remedy that a secured lender may have is to seek the appointment of a receiver over its collateral. However, if the lender succeeds and a receiver is appointed, the defaulting borrower’s “counterpunch” may be to file for Chapter 11. A borrower’s bankruptcy filing opens the door to potentially significant delay, uncertainty and expense for the secured lender in its efforts to recover on its loan. A recent bankruptcy court decision highlights one potential way to reduce the risk of a bankruptcy proceeding following the appointment of a receiver: through language in the receiver’s appointment order that divests the debtor’s management of authority to act on behalf of the debtor.
By Timothy T. Brock, Paul P. Josephson and Drew S. McGehrin
Cannabis companies had long been shut out of the U.S. bankruptcy system because federal courts refused to administer assets derived from or connected to federally prohibited activity. That meant distressed cannabis operators were left only with state-law options including receiverships, out-of-court restructuring or liquidating assets piecemeal—until now. On May 9, 2026, the U.S. Bankruptcy Court for the District of Delaware did something no federal court had ever done before: acting under Chapter 15 of the Bankruptcy Code – the U.S. framework for recognizing and aiding foreign insolvency proceedings – it recognized a Canadian (CCAA) proceeding involving a cannabis enterprise notwithstanding the continuing illegality of marijuana under federal law.
By Mairi V. Luce and Klara Bradbury
In Wingspire Equipment Finance LLC v. E-Crane International USA Inc., the United States Bankruptcy Court for the District of Delaware closed a long-running equipment-financing dispute with a practical warning for lenders: Funding a borrower’s purchase of equipment does not, by itself, give the lender an interest in the equipment or a direct claim against the vendor. The decisions in the case are a reminder that an equipment lender needs a documented path to title, control or other enforceable collateral rights to ensure it has a path to recovery in the event of a bankruptcy scenario.
An alert written by partner Chris Winter in Wilmington and special counsel Drew McGehrin in Philadelphia was republished in The Banking Law Journal. The alert— “Bankruptcy Court Finds Oversecured Creditor Not Entitled to Recovery of Post-Petition Attorneys’ Fees”— analyzed the U.S. Bankruptcy Court for the Eastern District of Tennessee’s ruling in In re Brandt, which held that an oversecured creditor did not have an allowed claim for post-judgment expenses, including attorneys’ fees, incurred after the bankruptcy petition was filed.
By Robert E. Grossman and Brad Lenox
In In re Endi Plaza LLC, the Bankruptcy Court for the Southern District of New York granted a stay pending an appeal of its prior order dismissing a bankruptcy case for bad faith but required the debtor to post a bond of more than $3 million during the pendency of the stay period. This decision is instructive for secured creditors that have been frustrated in their efforts to exercise state law rights by the filing of a bankruptcy case.
By Catherine Beideman Heitzenrater and Marie Bauer
In East Texas Machining & Manufacturing, LLC v. STV Engine 011, LLC, et al., the United States Bankruptcy Court for the Eastern District of Texas considered a motion for partial summary judgment filed by plaintiff-debtor East Texas Machining & Manufacturing LLC against STV Engine 001 LLC, Axle Box Innovations LLC and Texas Tactical Machining & Manufacturing LLC in an adversary proceeding within ETMM’s Chapter 11 bankruptcy case. The court granted ETMM’s motion based on a one-letter mistake in STV’s UCC-1 financing statement and found that STV’s $500,000 security interest was unperfected and therefore invalid and avoidable.
Five Duane Morris LLP attorneys have been named to the 2026 Lawdragon 500 Leading Global Bankruptcy & Restructuring Lawyers guide.
Morris S. Bauer – Bankruptcy, Creditors’ Rights
James Billingsley – Bankruptcy, Restructuring, Litigation
Robert Grossman – Corporate, Reorganization, Litigation
Meagen Leary – Creditors’ Rights, Real Estate Finance, Bankruptcy
Wendy M. Simkulak – Bankruptcy, Reorganization, Creditors’ Rights
Read more about the attorneys named by Lawdragon 500 on the Duane Morris LLP website.
By Marcus O. Colabianchi and Hunter C. Blume
Recently, the U.S. Bankruptcy Court for the Southern District of New York confirmed the Chapter 11 plan of liquidation for Broadway Realty I Co. LLC and affiliated debtors and approved the sale of a large portfolio of rent-stabilized residential properties to Summit Gold Inc., overruling objections by the City of New York. The decision provides guidance on the limits of housing-based objections and clarifies how bankruptcy courts may apply the “adequate assurance of future performance” standard to large, distressed residential portfolios.
Read the full Alert on the Duane Morris LLP website.
