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New Cases For the Week of February 7, 2011 - February 11, 2011
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| February 10, 2011 |
Case |
Court |
Holding |
In re Adelphia Recovery Trust
(DBN) |
2nd Cir. |
A DIP was a creditor of another DIP, and participated in and facilitated a sale of the assets of the second DIP, but remaining silent about the possibility that it would bring fraudulent conveyance claims with respect to its prior take-outs of loans secured by those assets. The first DIP was barred by res judicata and judicial estoppel from asserting such avoidance claims in its own case against banks whose loans were secured by the sold assets. |
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| February 8, 2011 |
Case |
Court |
Holding |
In re DBSD North America, Incorporated
(DBN) |
2nd Cir. |
The bankruptcy court erred in confirming a plan that violated the absolute priority rule by channeling substantial reorganized equity to old equity when unsecured creditors were not paid in full. The bankruptcy court's finding that the value allocated to old equity was a "gift" from secured creditors was error. "Gifting" under a plan is not permitted where unsecured creditors are not paid in full. |
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| February 7, 2011 |
Case |
Court |
Holding |
In re Bernard L. Madoff Investment Securities, LLC
(DBN) |
Bankr. SD NY |
A federal court has jurisdiction to enforce a settlement agreement only if the dismissal order specifically reserves such authority or the order incorporates the terms of the settlement. Absent some action making a settlement agreement part of a dismissal order or some other, independent basis for jurisdiction, enforcement of a settlement agreement is for state courts.
Where a settlement approved by the bankruptcy court contained an exclusive jurisdiction clause, but the related court-approved the stipulation, neither stated that the court retained jurisdiction over any aspect of the settlement, nor incorporated any of the settlement's terms, the bankruptcy court lacked jurisdiction to enforce the settlement. |
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