Most bankruptcy sales follow an auction format. For those willing to participate in the stalking horse bidding process that characterizes most such sales, there are often unique opportunities for well-financed purchasers to purchase assets at a significant discount. The process is designed to permit the highest and best bid to win. To identify the highest and best bid, debtors are given broad discretion in pursuing the sale of assets. Although bidders do have standing to raise matters relating to the integrity of the sale process, courts have repeatedly held that “disgruntled bidders” have no standing to object to the outcome of a bankruptcy sale once the winner has been selected. The recent order by the Bankruptcy Court for the District of New Jersey in Revel AC reiterates this point.1
Background
Revel AC (Revel or the company) is the owner and operator of the Revel Casino Resort (the casino) in Atlantic City. The casino was originally conceived as a state of the art gaming and resort facility. Construction on the casino began in 2007, but was not completed until 2012, after various financiers had invested approximately $2.4 billion. Troubled from the start, the casino underwent its first Chapter 11 restructuring in 2013 and subsequently entered Chapter 11 again in 2014.
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