Bankruptcy Litigation Committee

ABI Committee News

Pre-Plan Settlements Post-Iridium: Priority Scheme Will Be Most Important Factor

On March 5, 2007, in Motorola Inc. v. Official Committee of Unsecured Creditors (In re Iridium Operating LLC, et al.), the U.S. Court of Appeals for the Second Circuit proclaimed that “in the chapter 11 context, whether a pre-plan settlement’s distribution plan complies with the Bankruptcy Code’s priority scheme will be the most important factor for a bankruptcy court to consider in approving a settlement under Bankruptcy Rule 9019.”

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Recent Decisions Set a High Bar for Maintaining Confidentiality of Commercial Information

A number of recent decisions on whether to seal confidential commercial information under §107 of the Bankruptcy Code set a high bar for keeping information confidential. Implementing the constitutional and common law principle of public access to courts, Bankruptcy Code §107(a) establishes a general rule that papers filed in bankruptcy cases are open to examination by the public. Bankruptcy Code §§107(b) and (c) make limited exceptions to this principle for certain categories of information, including confidential commercial information. In four recent decisions, courts held that the documents or information at issue did not qualify for protection as confidential commercial information under Bankruptcy Code §107(b).

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Using §105 Injunctions to Enjoin Collection Actions against a Debtor’s Principals

The use of §105(a) to enjoin actions against a chapter 11 debtor’s principals has a long history under the Bankruptcy Code. The body of case law that has developed on the subject, however, is somewhat of a hodgepodge in that it has not produced a clear set of standards and therefore is lacking in predictive utility.

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Minutes from 2007 Annual Spring Meeting

On April 13, 2007, as part of the 2007 Annual Spring Meeting, the Litigation and Ethics Committees presented a joint program entitled, "When E-mail Goes Awry… Ethical Issues & Practical Problems that Arise in Bankruptcy Litigation."

The panel included:

Hon. Barry Russell – Moderator
U.S. Bankruptcy Court (C.D. Calif.); Los Angeles

Terri L. Gardner
Poyner & Spruill, LLP; Raleigh, N.C.

Karl Schafer
Carter, Ledyard & Milburn, LLP; New York

Ted Gavin, CTP
NachmanHaysBrownstein, Inc.; Wilmington, Del.

Steven R. Skirvin
Dion-Kindem & Crockett; Woodland Hills, Calif.

The attendance was excellent and the program went very well. Those in attendance were encouraged to submit articles for publication in the Litigation Committee's Newsletter.

Judge Russell announced that Mark Maloney will replace Rudy Cerone as co-chair of the committee. Judge Russell thanked Rudy Cerone for his outstanding service as co-chair and presented him with a plaque on behalf of ABI.