In the current post-pandemic landscape, automotive suppliers are increasingly seeking alternatives to traditional Chapter 11 bankruptcy filings to navigate financial distress and operational restructuring. This strategic shift is driven by a host of challenges facing the industry, such as persistent supply chain disruptions, raw material shortages, and the financial demands of transitioning to electrification. One…
The U.S. Trustee’s Office is urging a New York bankruptcy judge to recover fees and expenses from Reed Smith LLP, alleging that the firm failed to disclose its connections with directors of Eletson Holdings while representing the shipping company in its Chapter 11 bankruptcy. This development raises significant compliance and ethical considerations for legal practitioners…
The Chapter 11 bankruptcy filing of the former chief financial officer of McElroy Deutsch Mulvaney & Carpenter LLP has been dismissed. The New Jersey bankruptcy judge ruled that the filing was made in “bad faith” in an attempt to delay ongoing state litigation. The ex-CFO, currently incarcerated for embezzling over $1 million from the firm,…
Discount retailer Big Lots Inc. has filed for Chapter 11 bankruptcy protection and has agreed to a sale to Nexus Capital. The company plans to sell its assets and ongoing business in a court-supervised process, which highlights the financial distress and strategic shift for the retailer. According to a report by Bloomberg Law, the filing…
In a substantial uptick, commercial Chapter 11 bankruptcy filings saw a 21% increase in August compared to the previous month, according to recent data from Epiq. Projections indicate that corporate bankruptcy filings might surpass the 6,500 mark for 2023, a considerable rise from the fewer than 4,000 seen in both 2022 and 2021. This surge…
The currently-incarcerated former chief financial officer for McElroy Deutsch Mulvaney & Carpenter LLP has denied allegations that his Chapter 11 filing was a bad faith maneuver designed to stall ongoing civil litigation. Instead, he claims the bankruptcy will facilitate the liquidation of property in a way that benefits creditors. For more details, please refer to…
A hearing in a Chapter 11 bankruptcy case turned contentious on Thursday when a California bankruptcy judge criticized an attorney for her “obnoxious” conduct in court. The lawyer was advocating against a proposed liquidation plan for a defunct law firm, arguing that the plan could disproportionately benefit the professionals managing the case while offering minimal…
Earlier this week, a new lawsuit filed against Fenwick & West posits that the Biglaw firm’s role as attorney for a cryptocurrency client induced the plaintiff to invest. The plaintiff, Seven Peaks Ventures, invested in Prime Core Technologies, the parent company of crypto company Prime Trust, purchasing 700,000 shares in the Series A funding round,…
Rite Aid Corp. has once again shifted its legal leadership as it moves closer to exiting bankruptcy. Thomas Sabatino Jr., who was brought on roughly a year ago to steer the company through its restructuring process, has departed. In an August 19th securities filing, the company revealed that Christin Bassett has been appointed as the…
McElroy, Deutsch, Mulvaney & Carpenter has petitioned a U.S. Bankruptcy Court judge to dismiss a Chapter 11 bankruptcy filing submitted by the firm’s former chief financial officer, John Dunlea. Dunlea, who has pleaded guilty to embezzling over $1.5 million from the firm, has been sentenced to five years in prison. The firm contends that Dunlea’s…
A growing wave of financial tinkering by distressed companies to raise new money is leaving a lasting mark on corporate restructuring practices. Lawyers are now engineering and navigating evolving forms of liability management transactions that often pit creditors against one another in a battle for collateral and repayment priority. Since the Covid-19 pandemic, these controversies…
Rudolph Giuliani has entered into an agreement to pay $100,000 in cash upfront, along with proceeds from the future sales of his multi-million dollar properties, in order to settle administrative bankruptcy fees and officially conclude his Chapter 11 bankruptcy case. This arrangement follows an agreement reached with his largest creditors, which outlines the terms for…
In a recent development, U.S. Bankruptcy Judge Sean Lane indicated he might “reconsider” the dismissal of Rudy Giuliani’s Chapter 11 proceeding. Despite having initially ordered the dismissal earlier this month, Judge Lane has not been able to officially enter a judgment due to Giuliani’s claims of being unable to pay the administrative fees associated with…
In a notable decision, a federal bankruptcy court in West Palm Beach has dismissed the Gateway Pundits’ Chapter 11 bankruptcy case. U.S. Bankruptcy Judge Mindy Mora of the Southern District of Florida found that the publication failed to demonstrate a good faith intent in filing and pursuing the case. This ruling highlights the essential requirement…
Rudolph Giuliani faces a potential evidentiary hearing scrutinizing his financial dealings after his failure to establish satisfactory terms to dismiss his personal bankruptcy case. Giuliani, who owes approximately $400,000 in fees related to his Chapter 11 case, must comply with administrative expenses before Judge Sean Lane of the US Bankruptcy Court for the Southern District…
Rudy Giuliani’s financial and legal turmoil continues to unfold as his bankruptcy case takes a dizzying turn. Just days after a jury awarded $148 million to Ruby Freeman and Shaye Moss—Atlanta poll workers he defamed—Giuliani filed for Chapter 11 bankruptcy in December. His move aimed at staying the collection of the judgment pending appeal without…
The United States Bankruptcy Court on Friday dismissed the Chapter 11 bankruptcy case of former New York City mayor and Trump lawyer Rudolph Giuliani, citing his ongoing failure to comply with financial disclosure obligations, according to JURIST. Giuliani filed for Chapter 11 bankruptcy in December 2023, citing financial strain from a $148 million defamation judgment….
A Florida federal bankruptcy judge has converted the Chapter 11 case of an attorney who was acquitted last year in a billion-dollar medical fraud scheme to Chapter 7 proceedings. The decision came on the grounds that the debtor is currently unemployed and lacks the financial means to repay his creditors. The attorney had initially sought…
The recent US Supreme Court ruling in Harrington v. Purdue Pharma has invalidated nonconsensual third-party releases in Chapter 11 cases, a ruling that will profoundly influence large-scale restructurings. These releases have been a common fixture in mass tort bankruptcies and large corporate reorganizations, wherein entities connected to the debtor gain immunity from creditor claims. The…
Rudy Giuliani, former New York City mayor and lawyer for Donald Trump, faces a significant downfall as he transitions out of the practice of law in the wake of legal and financial troubles. Recently, the New York Appellate Division converted Giuliani’s suspension from law practice into full disbarment, citing that he made “demonstrably false and…
In a tight 5-4 decision, the US Supreme Court on Thursday nullified a multibillion-dollar opioid settlement involving Purdue Pharma, makers of OxyContin, due to its provision granting the Sackler family lifetime immunity from future opioid-related litigation. The Court’s decision mandates that settlement negotiations begin anew, potentially delaying compensation for over 100,000 people affected by the…
As the mechanics of Chapter 11 bankruptcy proceedings become more public, the practice of bankruptcy venue shopping has attracted increasing scrutiny and concern. While forum shopping might offer strategic advantages for corporations, such as predictable outcomes or perceived efficiencies, it runs counter to the principles of procedural justice, eroding public faith in the system. Robert…
A three-judge panel of the U.S. Court of Appeals for the Second Circuit has affirmed a Manhattan district judge’s ruling in favor of Charter Communications in a lawsuit involving advertising produced by Charter following the bankruptcy filing of its competitor, Windstream Holdings. Chief Circuit Judge Debra Ann Livingston, along with Circuit Judges José Cabranes and…
A recent decision from Chief Judge Glenn of the Southern District of New York Bankruptcy Court offers valuable insights for creditors and debtors engaged in settlement negotiations that include agreements requiring creditor support for the debtor’s Chapter 11 plan. In In re GOL Linhas Aéreas Inteligentes S.A., Chief Judge Glenn evaluated the enforceability of a…
The recent collapse of Synapse Financial Technologies Inc., a fintech middleman backed by Andreessen Horowitz, has highlighted significant risks associated with the “banking as a service” model. The San Francisco-based company, which filed for Chapter 11 bankruptcy protection in April, has left customers like Joseph Dominguez and his wife unable to access more than $20,000…