Motions to approve streamlined procedures for sales of de minimis assets are fairly routine in large chapter 11 cases, particularly in cases of retailers with many store locations that will be closed during a chapter 11 case. The Debtors understandably want an inexpensive procedure to sell assets free and clear of liens, claims and encumbrances; buyers at such sales likewise want the assurance that their purchases are not subject to later attack. Efficiency and expediency, however, cannot be achieved at the expense of required protections under the Bankruptcy Code.

Authority to sell assets worth less than $300,00 with no notice is denied. A request for advance findings of good faith sales with no evidence thereof submitted to the Court is denied. A request to hire sale-related professionals with no need for formal Court-approved retention procedures is denied.

Where an adversary proceeding defendant and a debtor settled in mediation in exchange for, among other things, an agreement that the defendant would sue his lawyers for malpractice and split any recovery with the debtor, the law firm did not have standing to object to the settlement approval in bankruptcy court. The law firm was not a creditor of the debtor. It was at most a potential debtor of a debtor of the (bankrupt) debtor.

Because the law firm lacked standing in the settlement approval proceeding it is not precluded from asserting as a defense in the malpractice action that the settlement was invalid.