Category: General

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.

Read the full Alert on the Duane Morris LLP website.

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.

Read the full Alert on the Duane Morris LLP website.

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.

Read the full Alert on the Duane Morris LLP website.

By Jessica Kenney Bonteque and Nathan Yeary

Section 363(m) of the Bankruptcy Code protects purchasers of assets in a bankruptcy sale. The rule protects a bankruptcy sale as long as the effectiveness of the order from the bankruptcy court approving the sale is not stayed pending resolution of an objection and the purchaser acts in “good faith.” A recent decision by the Bankruptcy Appellate Panel for the Eighth Circuit extends the protection afforded under Section 363(m) by permitting a purchaser’s “good faith” to be implied from the absence of evidence that the purchaser acted in “bad faith.” However, the dissent concluded that the absence of evidence that a purchaser lacks good faith is insufficient to support an inference of good faith.

Read the full Alert on the Duane Morris LLP website.