Michael R Lastowski

August 22, 2012 | Delaware Business Court Insider

In a recent opinion, the Chancery Court broadly interpreted a "no action clause" in an indenture to block disgruntled noteholders' efforts to have a receiver appointed for biopharmaceutical company Savient Pharmaceuticals.

By Michael R. Lastowski and Christopher M. Winter Special to the DBCI

5 minute read

June 19, 2013 | Delaware Business Court Insider

Section 365 of 11 U.S.C. provides a debtor with a valuable tool for reorganizing its business by permitting a debtor to assume or reject executory contracts or leases. However, Section 365 has its limits. A debtor must assume or reject a contract or lease in its entirety and may not cherry-pick among its various provisions, as in In re Fleming, 499 F.3d 300, 308 (3d Cir. 2007). An exception arises if the provisions are "severable," as in In re Buffets Holdings, 387 B.R. 115, 120 (Bankr. D. Del. 2008). In In re Contract Research Solutions, (Del. Bankr. May 1, 2013), a debtor argued that a lease amendment that added a new leasehold to the underlying lease was severable. U.S. Bankruptcy Judge Kevin J. Carey of the District of Delaware disagreed.

By Michael R. Lastowski and Christopher M. Winter

3 minute read

May 15, 2013 | Delaware Business Court Insider

In In re School Specialty, (Bankr. Del. April 22, 2013), Case No. 13-10125, the debtors had stipulated in an interim DIP order that they were liable to Bayside Finance LLC in the approximate amount of $95 million. That amount included an "early payment fee" (the "make whole payment") of about $23.7 million.

By Michael R. Lastowski and Christopher M. Winter

4 minute read

February 27, 2013 | Delaware Business Court Insider

U.S. Bankruptcy Judge Brendan L. Shannon of the District of Delaware confirmed a plan of reorganization and upheld the validity of a post-petition lockup agreement in In re Indianapolis Downs, Case No. 11-11046, in a 28-page opinion issued in late January.

By Michael R. Lastowski and Christopher M. Winter

5 minute read

January 16, 2013 | Delaware Business Court Insider

Early this month, New York's comptroller brought suit in Delaware Chancery Court to gain access to the political spending records of Qualcomm Inc. Independent of the Qualcomm action, it is reported that the Securities and Exchange Commission may by April propose rules for public company disclosure of political expenditures.

By Michael R. Lastowski and Christopher M. Winter
 Special to Delaware Law Weekly

3 minute read

May 23, 2012 | Delaware Business Court Insider

A bankruptcy claim in the hands of a transferee has the same disabilities as it would in the hands of the transferring creditor, the Delaware Bankruptcy Court concluded in a recent opinion in which it disallowed, under Section 502(d) of the Bankruptcy Code, nine claims held by claims traders.

By Christopher M. Winter and Michael R. Lastowski

5 minute read

April 11, 2012 | Delaware Business Court Insider

In his recent decision in In re All Land Investments (D. Del. March 9, 2012), U.S. Bankruptcy Judge Kevin J. Carey of the District of Delaware refused to confirm a Chapter 11 plan of reorganization that sought to "cram down" a secured lender. Carey found that the two classes that had accepted the plan were "artificially impaired." Therefore, there was no impaired accepting class of creditors to support a cram-down under 11 U.S.C. §1129(b). Carey's decision demonstrates that there are limits to a debtor's ability to successfully manipulate plan distributions so as to "impair" a class of creditors likely to vote to accept a plan.

By Michael R. Lastowski

5 minute read

May 02, 2012 | Delaware Business Court Insider

The current economic downturn began in 2008 with a wave of frequent Chapter 11 filings that continued until last year. In light of the two-year limitations period (commencing on the filing date) under 11 U.S.C. §546(a), it is not surprising that this wave of case filings has been followed by a wave of avoidance actions. As these cases proceed before our bankruptcy judges, the limits of a trustee's avoidance powers are becoming more defined.

By Michael R. Lastowski Special to

4 minute read