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Breach of Contract › Commercial Bankruptcy › Creditors

Stark & Stark

5 Issues for Landlords During a Bankruptcy Lease Rejection

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When a commercial tenant files for bankruptcy, they have the option to assume or reject unexpired leases. A bankruptcy lease rejection is a significant action, as it communicates the debtor’s intent to hand back the space....more

Jones Day

Fifth Circuit Rules that Serta Simmons Uptier Violated Credit Agreement, Rejects Equitable Mootness as Bar to Review of Chapter 11...

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In In re Serta Simmons Bedding, LLC, 125 F.4th 555 (5th Cir. 2024), as amended, No. 23-20281 (5th Cir. Jan. 21, 2025), revised and superseded, No. 23-20181 (5th Cir. Feb. 14, 2025), reh'g denied, No. 23-20181 (5th Cir. Feb....more

DLA Piper

Fifth Circuit Rules that Serta Simmons Bedding, LLC’s 2020 Uptier Transaction Violated Pro Rata Distribution Covenant

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In a landmark ruling, the US Court of Appeals for the Fifth Circuit ruled that a June 2020 refinancing transaction (the Uptier Transaction) entered by Serta Simmons Bedding, LLC (SSB, or the Debtor) and certain of its lenders...more

Akin Gump Strauss Hauer & Feld LLP

Serta - Fifth Circuit Decision

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On December 31, 2024, the U.S. Court of Appeals for the Fifth Circuit issued its long-awaited decision regarding the permissibility of the Serta Simmons Bedding (Serta) uptier liability management exercise (the 2020 Uptier)...more

Morrison & Foerster LLP

Latest Uptier Decisions in Serta and Mitel Remind Contract Language Matters

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The caselaw on “uptiers” as liability management exercises (LMEs) grew by two opinions on the last day of 2024. In Serta, the Fifth Circuit reversed the bankruptcy court’s blessing of the pre-bankruptcy uptier and...more

Hendershot Cowart P.C.

Executory Contracts and Contract Rejection: What Non-Debtors Need to Know About Bankruptcy

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Bankruptcy debtors have special rights in contracts or leases where both parties have outstanding obligations, known in legal terms as “executory contracts” or “unexpired leases”. If you are doing business with a company that...more

Williams Mullen

Distressed Clients? Struggling Suppliers? Recession Risks? 7 Practical Considerations to Protect Your Bottom Line

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​​​​​​​Customers and suppliers may not willingly admit they are in distress, even when sources of economic pressure can be found everywhere. However, there are some practical steps you can take to increase your situational...more

Arnall Golden Gregory LLP

Lender Liability Is Not Dead: A Recent Case Presents a Warning for Lenders (and a Roadmap for Borrowers)

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A recent decision from the U.S. Bankruptcy Court for the Northern District of Texas illustrates that aggressive lender action can lead to “lender liability” in a loan workout. Bailey Tool & Mfg. Co., et al. v. Republic Bus....more

Tucker Arensberg, P.C.

Informal but Actual Notice of Bankruptcy: What Difference Does It Make?

Tucker Arensberg, P.C. on

On January 3, 2021, in In re Ditech Holding Corporation, Case No. 19-10412 (JLG), an unpublished opinion, Bankruptcy Judge James L. Garrity, Jr., discussed an important distinction for creditors of a non-individual chapter 11...more

Farella Braun + Martel LLP

Three Steps Licensees Can Take to Protect Their IP Rights in Bankruptcy

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During periods of widespread economic disruption such as the present, operating businesses must be able to identify and respond to threats to the financial health of their contracting counterparts in order to protect key...more

Herbert Smith Freehills Kramer

Court Holds Filing of Proof of Claim Results in Waiver of Right to Jury Trial Despite Claimants’ Purported Reservation of Rights

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In an opinion dated Jan. 10, 2020, Bankruptcy Judge Craig A. Gargotta of the Western District of Texas (San Antonio Division) held that a creditor who submits a proof of claim in bankruptcy waives its right to a jury trial,...more

Bennett Jones LLP

Supreme Court to Consider Enforceability of Consequences Imposed Upon Insolvency

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The Supreme Court of Canada recently granted leave to appeal from the Alberta Court of Appeal's decision in Capital Steel Inc v Chandos Construction Ltd, 2019 ABCA 32. The case addresses the enforceability of clauses that...more

Patterson Belknap Webb & Tyler LLP

Another Ruling on Public Auctions Versus Private Sales Under Section 363

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Two weeks ago, we discussed asset sales under Bankruptcy Code section 363. As that post noted, section 363 requires court approval for asset sales outside the ordinary course of business, with courts ensuring that sales...more

Troutman Pepper Locke

Bankruptcy Court Holds That “Economic Waste” Doctrine, As Adopted In Wisconsin, Prevented Owner From Recovering Costs To Repair...

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WTE-S&S AG Enters., LLC v. GHD, Inc., 2017 Bankr. LEXIS 2343 (Bankr. N. D. Ill. August 18, 2017) - This breach of contract dispute arises out of a contract to design and build a cow-manure digester on a farm in Wisconsin. ...more

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