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Chapter 11 Plans of Reorganization and Equipment Lessors
Filing Chapter 11 is a very expensive proposition these days. The filing fees, coupled with the astronomical attorneys' and special litigation counsels' fees, plus the accountants' fees, are just a few of the expenses for a debtor-in-possession (“DIP”). So what does this mean for us as equipment lessors? It means we must react accordingly and often very quickly to protect ourselves.
It means that many company DIPs set up their exit strategy before they file Chapter 11 to minimize the time that they are in a Chapter 11 bankruptcy proceeding and thereby minimize their costs for attorneys and other fees that the DIPs incur. That equates to us, as equipment lessors, having to play catch-up after being taken by surprise by a slew of so-called “First Day Motions” (such as Motions to Approve Cash Collateral or Debtor-in-Possession Financing, Motions to Pay Pre-Petition Wages, Motions to Pay Utilities, Motions to Pay Critical Vendors, Motions to Employ DIP Attorneys and others similar motions). You might even see a Motion to Sell Substantially All Assets of the DIP, or a Disclosure Statement and Plan of Reorganization filed just a few weeks after the Chapter 11 filing. Just as we are reading the court orders on the First Day Motions, we are inundated with additional pages of documents to read and analyze in order to protect our rights before it's too late.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
Judge Rules Shaquille O'Neal Will Face Securities Lawsuit for Promotion, Sale of NFTs
A federal district court in Miami, FL, has ruled that former National Basketball Association star Shaquille O'Neal will have to face a lawsuit over his promotion of unregistered securities in the form of cryptocurrency tokens and that he was a "seller" of these unregistered securities.
Why So Many Great Lawyers Stink at Business Development and What Law Firms Are Doing About It
Why is it that those who are best skilled at advocating for others are ill-equipped at advocating for their own skills and what to do about it?
Blockchain Domains: New Developments for Brand Owners
Blockchain domain names offer decentralized alternatives to traditional DNS-based domain names, promising enhanced security, privacy and censorship resistance. However, these benefits come with significant challenges, particularly for brand owners seeking to protect their trademarks in these new digital spaces.
Coverage Issues Stemming from Dry Cleaner Contamination Suits
In recent years, there has been a growing number of dry cleaners claiming to be "organic," "green," or "eco-friendly." While that may be true with respect to some, many dry cleaners continue to use a cleaning method involving the use of a solvent called perchloroethylene, commonly known as perc. And, there seems to be an increasing number of lawsuits stemming from environmental problems associated with historic dry cleaning operations utilizing this chemical.