Focus
.01 Bankruptcy Law
Bankruptcy Cases
Business bankruptcy cases can involve a wide range of complex legal and financial matters: ​
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Chapter 7 Liquidation:
Involves the complete liquidation of the business assets to pay off creditors. A Chapter 7 trustee is appointed to oversee the liquidation process.
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Chapter 11 Reorganization:
Allows businesses to restructure their debts and operations while continuing to operate. This includes creating a reorganization plan approved by creditors and the court.
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Creditor Claims and Priorities:
Determining the validity and priority of creditors' claims against the business, which can include secured, unsecured, and priority claims.
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Automatic Stay:
Halts all collection actions, lawsuits, foreclosures, and creditor harassment against the business once bankruptcy is filed.
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Asset Sales:
Selling business assets, including real estate, inventory, equipment, and intellectual property, to generate funds to pay creditors.
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Preference Actions:
Recovery of payments made to creditors shortly before bankruptcy that may be deemed preferential and recovered for equal distribution among creditors.
Avoidance Actions:
Actions to recover transfers of property made by the debtor before bankruptcy that may be fraudulent or preferential.
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Creditors' Committees:
Formation of committees representing creditors to participate in the bankruptcy process, negotiate with the debtor, and ensure fair treatment of creditors.
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Plan Confirmation:
Approval of a reorganization plan in Chapter 11 bankruptcy that outlines how creditors will be paid, including the treatment of different classes of creditors.
Employee Issues:
Addressing employee wages, benefits, and potential layoffs or workforce reductions as part of the bankruptcy process.
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Lease and Contract Issues:
Treatment of leases and contracts, including assumption, rejection, or renegotiation of existing agreements by the debtor.
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Tax Issues:
Handling tax obligations, potential tax refunds, and negotiating with tax authorities as part of the bankruptcy process.
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Fraud and Mismanagement:
Investigation and potential litigation related to allegations of fraud, mismanagement, or other misconduct by the debtor’s management.
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Post-Bankruptcy Operations:
Managing ongoing operations during bankruptcy, including obtaining court approval for major business decisions.
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Discharge and Reorganization:
Issuance of a discharge in Chapter 7 or confirmation of a reorganization plan in Chapter 11, which provides the business with a fresh start or structured repayment plan.
Representative Experience
Chapter 7 Trustee
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Lead counsel for eight Texas Chapter 7 Trustees (Litzler, Ries, Newhouse, Weisbart, Moser, Chow, Segner, McNally, and Payne) and responsible for the creation of more than one-hundred asset cases and millions of dollars of estate value through asset sales, sales of going concern businesses, contested exemption claims, and prosecution of avoidance actions;
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Notable trustee cases include serving as primary and supervisory counsel for team of five attorneys representing Chapter 7 Trustee of an administratively insolvent converted Chapter 11 estate in the analysis and pursuit of over 100 litigation claims, litigation and settlement of contested administrative claims including significant super-priority cash collateral claim, and recovery of millions of dollars for estate and creditors.
Creditor Representation
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Secured lenders: responsible for the preservation and enforcement of lien rights in bankruptcy cases for national, regional, and local, including contested plan confirmations, claim determinations, and where necessary, foreclosure and sale of REO property;
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Unsecured lenders: cases include serving as lead counsel for Official Committee of Unsecured Creditors in order to preserve value for subordinated creditors in reorganized business, assisting individual creditors in preserving position in reorganization plans, prosecuting objections to discharge and dischargeability in order to preserve claims;
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Defensive litigation: representation of lenders in preference and lender-liability claims;
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Notable cases include confirmation of creditor Chapter 11 Plan, contesting cram-down attempts and successfully forcing sale of real estate and “pink-sheet” stock collateral resulting in full satisfaction of secured claim including fees and interest, and blocking cram-down of disputed lien position and assisting in subsequent liquidation of business resulting in return on loan in significant excess of asserted cram-down value and booked value of loan.
Chapter 11
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Representation of debtors-in-possession under Chapter 11 of the Bankruptcy Code in the successful reorganization, and where necessary liquidation, of ongoing businesses and real estate, both through consensual plans and cram-down;
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Representation of insurers in connection with ongoing post-confirmation litigation in and arising out of bankruptcy proceedings;
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Representation of businesses seeking to acquire asserts or ongoing business enterprises from Chapter 11 debtors;
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Notable cases include the successful restructuring of credit facilities and sales of commercial real property, including successful confirmation of complex Chapter 11 Plan involving numerous secured lenders with different lien positions on real property valued at ~$30M.
