bankruptcy – Business Reorganization and Financial Restructuring

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.

Read the full Alert on the Duane Morris LLP website.

March 13, 2026March 13, 2026 by Duane Morris

Duane Morris Partners Named to 2026 Lawdragon 500 Leading Global Bankruptcy & Restructuring Lawyers Guide

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

February 11, 2026February 11, 2026 by Duane Morris

Bankruptcy Court Provides Guidance on Adequate Assurance of Future Performance in Sale of Distressed Real Estate

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.

July 17, 2025July 17, 2025 by Duane Morris

Structurally Unsound: District Court Reverses Bankruptcy Court on Good-Faith Transferee’s Defense Based on Value Provided to Chapter 7 Debtor’s Affiliate

By Catherine Beideman Heitzenrater and Nathan Yeary

The United States District Court for the Southern District of New York recently addressed a transferee’s attempt to use corporate veil-piercing to defend against an avoidance action by a Chapter 7 trustee. The transferee-defendant argued that its potential liability for a challenged payment from the debtor could be offset by the value that it had provided to the debtor’s nondebtor affiliate. The Bankruptcy Court for the Southern District of New York dismissed the trustee’s action and agreed with the transferee-defendant that a nondebtor special purpose vehicle formed to acquire and hold real estate for the debtor was the debtor’s alter ego. The District Court reversed on appeal and concluded that the transferee did not have a reasonable equivalent value defense based on consideration provided to the special purpose vehicle, nondebtor affiliate of the debtor in exchange for a downpayment from the debtor.

Read the full story on the Duane Morris LLP website.

June 9, 2025June 9, 2025 by Duane Morris

Freeze! Lapsed Financing Statement May Not Be Fatal in Bankruptcy

By James Billingsley and Drew S. McGehrin

A lapsed financing statement may not extinguish a creditor’s secured position in a bankruptcy case, according to the recent decision Utah Bankruptcy Court styled Thomson v. Short (In re Short). Secured lenders are nevertheless well advised to monitor and timely file continuation statements under any circumstances, especially in the case of a borrower bankruptcy.

Read the full story on the Duane Morris LLP website.

February 3, 2025February 12, 2025 by Duane Morris

Bankruptcy Court Finds Open Market Purchase Faulty Under Credit Agreement

In In re Serta Simmons Bedding, L.L.C., No. 23-20181, 2024 WL 5250365 (5th Cir. Jan. 21, 2025), as revised (Jan. 21, 2025), the Fifth Circuit Court of Appeals held that the controversial “uptier transaction” undertaken by Serta Simmons Bedding and affiliates in 2020 did not qualify as an “open market purchase” under the terms of its credit agreement, and thus was not permitted. The Fifth Circuit remanded certain aspects of the case back to the U.S. Bankruptcy Court for the Southern District of Texas.

Read the Alert on the Duane Morris LLP website.

February 9, 2022February 28, 2022 by Duane Morris

Section 502(b)(6): A Ceiling, Not a Method for Calculating Actual Damages

Skip DiMass and Diane Kim wrote for The Legal Intelligencer on commercial leases and the damage calculation in the bankruptcy process.

In In re East Penn Children’s Learning Academy, (Bankr. E.D. Pa. Dec. 3, 2020), the U.S. Bankruptcy Court for the Eastern District of Pennsylvania made clear that Section 502(b)(6) of the Bankruptcy Code provides a statutory limitation—rather than a formula for the calculation—of a landlord’s actual damages in the event of its tenant’s breach.

To read the full article, please visit the Duane Morris LLP website.

December 23, 2021February 28, 2022 by Duane Morris

In Bankruptcy, Rejection of Prepetition Contracts Is Not Automatic

Skip DiMassa and Malcolm Bates wrote for The Legal Intelligencer on debtors’ contractual obligations.

In In re Brick House Properties, Bk. No. 20-26250, (Bankr. D. Utah June 11, 2021), the U.S. States Bankruptcy Court for the District of Utah denied a debtor’s motion to reject its prepetition contract for the sale of real property under Section 365 of the Bankruptcy Code. The bankruptcy court found that because the debtor was already subject to a state court-specific performance order compelling it to take the ancillary steps necessary to close the sale, the contract was no longer executory and could not be rejected.