In The News

Chambers Continues to Award Haynes and Boone Talent High Marks in Global Directory

After a year in which Haynes and Boone, LLP widened its global reach with offices in China and Brazil, Chambers Global 2014 broadened its recognition of the firm by singling out 13 lawyers and five practices for praise in its highly regarded directory of recommended legal services.

Editors praised Haynes and Boone efforts on multiple fronts from the United States to Latin America to Mexico City. >>

Haynes and Boone Highlighted in Chambers USA 2013

Haynes and Boone, LLP has been recognized in Chambers USA: America’s Leading Lawyers for Business 2013, an annual law firm directory. Chambers highlighted 19 of the firm’s practices along with 51 individual firm lawyers in their rankings.

The firm’s Bankruptcy/ RestructuringFranchising and Intellectual Property practices each earned national rankings. >>



Recent Publications

Weathering the Storm: Seventh Circuit Expands Application of Federal Standard for Successor Liability to FLSA

On March 26, 2013, in the case of Teed v. Thomas & Betts Power Solutions, L.L.C., the Seventh Circuit, in an opinion written by Judge Posner, joined at least one other circuit court and a multitude of district courts across the country in extending the federal common law standard for evaluating successor liability to suits brought under the Federal Labor Standards Act (“FLSA”). >>

Weathering the Storm: Delaware Bankruptcy Court Declines to Designate Votes of Parties to a Post-Petition Restructuring Support Agreement

On January 31, 2013, the Bankruptcy Court for the District of Delaware in In re Indianapolis Downs, LLC declined to designate the votes of parties to a post-petition restructuring support agreement (i.e., a lock-up agreement), instead confirming the Debtors’ Modified Second Amended Joint Plan of Reorganization (the “Plan”) based on the votes of such parties. >>



Lenard M. Parkins

Partner

New York


30 Rockefeller Plaza
26th Floor
New York, New York 10112
T +1 212.659.4966
F +1 212.884.8226
M +1 713.542.7225

Houston


1221 McKinney Street
Suite 2100
Houston, Texas 77010
T +1 713.547.2008
F +1 713.236.5405

Areas of Practice

Education

  • J.D., University of Houston Law Center, 1976, Managing Editor, Houston Law Review (1975-76); Order of the Barons Honor Society
  • B.S., Washington and Lee University, 1970

Bar Admissions

  • Texas
  • New York

Court Admissions

  • United States Supreme Court
  • U.S. Court of Appeals for the Fifth Circuit
  • U.S. Court of Appeals for the Second Circuit
  • U.S. District Court for the Southern District of New York
  • U.S. District Court for the Eastern District of New York
  • U.S. District Court for the Northern District of Texas
  • U.S. District Court for the Southern District of Texas
  • U.S. District Court for the Western District of Texas
Lenard M. Parkins

Lenard Parkins specializes in the counseling and representation of large corporations, bondholders, indenture trustees, secured lenders, numerous funds, and creditor committees in financial restructurings, litigation, workouts and formal reorganization cases throughout the United States. He has also represented debtors regarding issues of dealing with collective bargaining agreements and the requirements needed to deal with collective bargaining agreements under Section 1113 of the bankruptcy code. Some of his representative matters include:

  • Senior bankruptcy and trial counsel representing Midland Loan Services as special servicer on an $825 million senior secured loan collateralized by 45 hotels in the Innkeepers bankruptcy case pending in the Southern District of New York Bankruptcy Court.
  • Representation of an affiliate of The Related Companies in the Chapter 11 case of FKF Madison Group Owner LLC pending in Wilmington, Delaware.
  • Representation of second lien agent and certain second lien (junior) lenders in the FX Luxury Las Vegas I, LLC bankruptcy case in the Las Vegas, Nevada bankruptcy court. Successfully obtained ownership for the firm's clients of a seventeen-acre property located on the Las Vegas strip across from City Center.
  • Representation of PIM Ashford Subsidiary I, LLC, an affiliate of Ashford Hospitality Trust, Inc., in the Chapter 11 case of Transwest Resort Properties, Inc. pending in Tucson, Arizona.
  • Represents The Penn Traffic Company and its affiliates as Debtors' Counsel in their Chapter 11 cases pending in the United States Bankruptcy Court in Wilmington, Delaware.
  • Represented The Bank of New York as agent for the first lien lenders in Wellman, Inc.'s Chapter 11 case in the Southern District of New York. Successfully defeated efforts by the Debtor and junior lien holders to effect a cramdown valuation of the agent's collateral. The Court found the value of the agent's collateral to be twice the amount proposed at trial by the debtor and junior lienholders.
  • Represents the senior lenders in the Chapter 11 cases of Latham International, Inc. and its affiliates pending in the United States Bankruptcy Court in Wilmington, Delaware.
  • Represents NexBank, SSB and ad hoc second lien lender group in connection with Metroflag workout.
  • Represents secured lenders and equity holders in the cable TV Chapter 11 cases of Broadstripe, LLC and its affiliates pending in the United States Bankruptcy Court in Wilmington, Delaware.
  • Represents secured lenders and equity owners in large retail and distribution Chapter 11 case in Dallas.
  • Represented prepetition secured lenders, that were also DIP and exit financing lenders that became the equity owners of JHT Holdings, Inc., implemented by a debt-for-equity swap in this national trucking company case in the United States Bankruptcy Court for the District of Delaware.
  • Represented Atlas Worldwide Holding, Atlas Air Inc., Polar Air Cargo Inc., in their financial restructuring and successful confirmed Chapter 11 cases in Miami, Florida, on July 16, 2004. This effort included the first restructuring of Enhanced Equipment Trust Certificates (EETC's) through an airline Chapter 11 case. Atlas is headquartered in New York.
  • Represents Highland Capital Management, LP in various restructuring transactions and in Chapter 11 matters throughout the United States. These representations include the Delphi Corporation Chapter 11 case as well as the Solutia, Inc. Chapter 11 case, both in the United States Bankruptcy Court for the Southern District of New York.
  • Represented MAIR Holdings, Inc. in the Mesaba Chapter 11 case in Minneapolis, Minnesota.
  • Represented the secured bank group of La Petite Academy, Inc.
  • Represented the Indenture Trustee and senior secured bondholders in Epic Resorts, LLC Chapter 11 case in Wilmington, Delaware.
  • Represented the senior secured lenders in Nexpak Industries, Inc. in its financial restructuring efforts and pending Chapter 11 case in Canton, Ohio. A pre-negotiated reorganization plan has been filed where the senior secured lenders will exchange a portion of their debt for the new equity of reorganized Nexpak along with holding a performing senior secured debt Instrument.
  • Represented the secured term lenders in the Galey & Lord Industries Chapter 11 case in Atlanta, Georgia.
  • Represented senior secured lender on steering committee and take-out working capital lender in the Trussway Industries, Inc., restructuring in Houston, Texas.
  • Represented senior secured sender on steering committee in respect of Citation Corporation.
  • Currently represents Sysco Corporation in restructurings and bankruptcy cases throughout the United States.
  • Currently represents the Sygma Network (major food service supplier and subsidiary of Sysco Corp.) in restaurant restructurings throughout the United States.
  • Currently represents Vistar Corporation in respect of acquisition opportunities in restaurant Chapter 11 cases throughout the United States.
  • Represented Continental Airlines as Chapter 11 Debtor in Possession in its first successful Chapter 11 case in Houston, Texas.
  • Represented Buttes Gas and Oil Company as Chapter 11 debtor in possession in its Chapter 11 case in Houston, Texas.
  • Represented the secured bank group in the Box-Crow Cement Company Chapter 11 case in Dallas, Texas.
  • Represented senior secured lender on steering committee in Dade Behring, Inc. restructure in Wilmington, Delaware.
  • Represented the senior secured lenders in Moll Industries Inc.'s, restructure and successful confirmed Chapter 11 case in San Antonio, Texas in 2003. In this case, the senior secured lenders exchanged a portion of their senior secured debt for the equity of reorganized Moll Industries, becoming the new owners of the reorganized company along with holding a performing senior secured debt instrument.
  • Represented First Plus Financial, Inc. as debtor in possession in its Chapter 11 case in Dallas, Texas.
  • Represented the unsecured creditors committee consisting of $250 million of unsecured noteholders in the Commercial Financial Services Chapter 11 case in Tulsa, Oklahoma.
  • Represented Northwest Airlines, Inc. in major Bankruptcy Court litigation in Maine regarding commuter airlines relationship.
  • Represented Bristol Resources as debtor in possession in its Chapter 11 case in Houston, Texas.
  • Represented Castle Dental, Inc. in its successful financial restructuring in Houston, Texas.
  • Represented Northwest Airlines, in Minneapolis, Minnesota in their financial restructurings in 1992-1993 and 1998.
  • Represented Northern Border Pipeline in 2002, a subsidiary of Enron Corporation, in analysis of substantive consolidation issues for Northern Border during the Enron Chapter 11 case.
  • Represented Prime Succession as debtors' counsel in its pre-negotiated successful Chapter 11 case in Ft. Lauderdale, Florida.
  • Represented the Asbestos Tort Claimants' Committee in the first Chapter 11 case of National Gypsum in Dallas, Texas.
  • Represented the Tort Claimants' Committee in the Dow Corning Chapter 11 Case in Bay City, Michigan.
  • Represented Martin Shugrue when he acted as Chapter 11 Trustee for Eastern Airlines.

Speeches and Publications

  • "Delaware Bankruptcy Court Declines to Designate Votes of Parties to a Post-Petition Restructuring Support Agreement," Pratt's Journal of Bankruptcy Law, April/May 2013.
  • Speaker on various bankruptcy related topics at various CLE seminars and presentations.
  • Adjunct professor of law at the University of Houston Law Center from 1986-2001.

Professional Recognition

  • Recognized by Chambers Global in Bankruptcy/Restructuring, 2014
  • Recognized by Chambers USA as a leading lawyer in Bankruptcy in New York, 2012-2014, and was selected as a "recommended practitioner" in 2014
  • Recognized as one of The Best Lawyers in America - Bankruptcy and Creditor Debtor Rights/Insolvency and Reorganization Law, 2005-2015; Litigation - Bankruptcy, 2014-2015
  • Selected for inclusion in Super Lawyers, 2003-2007, 2009-2013
  • Martindale Hubbell® Law Directory with a Peer Review Rating of AV® Preeminent™

Selected Representative Experience


Frac Diamond Aggregates LLC
Represented Spectrum Origination LLC in its capacity as administrative agent and lender under a $30.8 million credit facility for Frac Diamond Aggregates LLC and Alliance Consulting Group, LLC . FDA used the proceeds of the credit facility to acquire a 1,700-acre sand mine and related assets from the debtor, free and clear of all liens, claims, interests and other encumbrances, pursuant to 11 U.S.C. §§ 105 and 363. ACG used the proceeds of the facility for the construction of a related sand drying and storage facility. The facility was secured by the sand mine, drying facility, and related assets, including the borrowers’ rights under certain storage and supply agreements, construction agreements, and other project documents.

RP Holdings Inc. Restructuring
Haynes and Boone was engaged by RP Holdings Inc. in August 2011 to assist in its restructuring efforts. At that time, the company had just hired a new CEO, was facing liquidity challenges due to the nationwide stoppage of foreclosure prosecutions, and had completed internal audits showing a total of approximately $20 million was owed to it by its two largest customers. Its senior secured facility was due to mature in August 2012. In the fall of 2012, the company pursued a restructuring transaction with its private equity sponsors, the secured lenders and the two law firms, which failed to materialize on the eve of a possible closing in early January 2012.

Innkeepers USA Trust
Representation of Midland Loan Services, the special servicer for an $825 million mortgage debt, in the Chapter 11 case of InnkeepersUSA Trust. Innkeepers' attempt to enter into a plan support agreement regarding a debt-for-equity swap was defeated. Midland's efforts resulted in the properties being placed on the market and a substantial increase in creditor recoveries.

Latham International, Inc. - Chapter 11 Prepackaged Plan
Representation of prepetition lenders (funds and private equity) in acquisition of the largest manufacturer of swimming pool components and pool accessories in North America pursuant to a prepackaged plan of reorganization.

The Penn Traffic Company - Chapter 11
Representation of The Penn Traffic Company and its subsidiaries in their Chapter 11 cases in the Delaware bankruptcy court. At filing, Penn Traffic owned and operated 79 supermarkets in the northeast part of the United States, and had total debt exceeding $250 million and annual revenues approaching $900 million. Following a spirited marketing and sale process, debtors sold substantially all their assets to TOPS Markets, LLC.

Amcast Industrial Corp.
Representation of the agent for the secured lenders who are owed approximately $110 million in the out-of-court restructuring negotiations of this automotive supplier.

Broadstripe, LLC
Representation of certain first and second lien lenders in the Chapter 11 case of this cable, phone and internet provider, formerly known as Millennium Digital Media Capital, LLC, which filed for bankruptcy in Delaware in January 2009.

Wellman Inc.
Represented The Bank of New York as agent for the first lien lenders in this Chapter 11 case in the Southern District of New York. Successfully defeated efforts by the Debtor and junior lienholders to effect a cramdown valuation of the agent’s collateral at $70 million. After a hotly contested evidentiary trial, the efforts by Wellman and the junior lienholders failed and the court found the value of the agent’s collateral to be $140 million - two times the amount proposed by the debtor and junior lienholders.

Delphi Corporation
Representation of a hedge fund that was both a major creditor and equity holder of Delphi. The fund sought to serve as a lead plan proponent with the Debtors. The fund's proposal was determined not to be the highest and best proposal. Delphi ultimately confirmed another plan of reorganization with the assistance of the U.S. government and General Motors in conjunction with the GM Chapter 11 case. Creditors received significantly less than they would have received under the original plan proposal.

JHT Holdings, Inc.
Represent pre-petition secured lenders, that are also DIP and exit financing lenders and prospective equity owners of the company to be effected in a debt-for-equity swap in this national trucking transport company.

Debtor-in-Possession Financing and Exit Financing
Represented the administrative agent in connection with the negotiation, documentation, closing and ongoing administration of a debtor-in-possession financing and a subsequent exit financing for a major manufacturer of paper products.

Highland Capital
Represented the senior secured lenders with nearly $300 million of exposure in this highly contested Chapter 11 case in Nashville, Tennessee. The case involved the proper standard for interest on over-secured creditors’ claims in a Chapter 11 case.

Trussway
Represented the largest term lender in the out-of-court restructuring of the debt and equity of this manufacturer of structured building materials.

Debtor-in-Possession Financing - International Air Cargo Company
Represented a major international air cargo company in the negotiation, documentation and closing of debtor-in-possession financing and a subsequent exit working capital credit facility, in connection with its Chapter 11 Bankruptcy proceeding.

Debtor-in-Possession and Exit Financing
Represented the administrative agent in connection with the negotiation and documentation of debtor-in-possession and subsequent exit financing for a manufacturer and supplier of building materials.

Debtor Representation - Atlas Air Worldwide Holdings, Inc.
Completed the successful restructuring of this company’s financial affairs, including restructuring more than $2.5 billion of debt in a bankruptcy case that was completed in only six months. Significant achievements in this case included restructuring the company’s enhanced equipment trust certificates (the first time this has ever been accomplished in a Chapter 11 case), restructuring all of the company’s leveraged leases and financed aircraft, effectuating the substantial buildup of cash during Chapter 11, and effectuating a rights offering of new common stock to creditors pursuant to the Chapter 11 plan. Atlas operated in Europe, the Middle East, and Asia and the reorganization involved coordination with numerous foreign jurisdictions and regulatory authorities.

Creditors’ Committee Representation - Epic Resorts
Represented the bondholders committee that commenced involuntary bankruptcy cases against this time share operator. We continue to represent the bondholders in connection with the bankruptcy case.

Wickes, Inc.
Represent the indenture trustee on behalf of the secured bondholders who are owed approximately $40 million in the Chapter 11 case of this lumber company pending in Chicago, Illinois.

Representation of Debtor - First Plus Financial
Represented this major financial services enterprise that specialized in the origination, securitization, and servicing of high loan to value consumer loans. Assets totaled more than $3 billion.

Representation of Creditors’ Committee - Finance
Our attorneys represented the Creditors’ Committee in the Chapter 11 case of Empire Funding that specialized in the origination, securitization and servicing of almost $4 billion of high loan-to-value consumer loans.

Chapter 11 Debtor Representation - Drypers Corporation
Represented this debtor-in-possession which was a major manufacturer of diaper products worldwide. The company was unable to reorganize and adopted a liquidating plan. We conducted a sale of four separate subsidiaries of the company through the bankruptcy auction process to separate buyers for U.S., South American, Puerto Rican and Malaysian operations.

Debtor-in-Possession Representation - Pentacon
Represented Pentacon and its affiliates in their successful reorganization in Chapter 11. Pentacon is a worldwide distributor of C-Class components to the aerospace industry and provided “just in time” inventory management services to industrial and aerospace companies.

Bankruptcy Preparation - Airline
Represented major airline in the representation of several other major air carriers. Also advised major airline management regarding its use of bankruptcy as a means of resolving its difficult labor situation.

Representation of Tort Claimants Committee - Dow Corning

Representation of the tort claimants committee representing individual claimants who sustained injuries attributable to breast implants and other medical implant devices. This historic Chapter 11 case was filed in Michigan and involved myriad novel issues. Litigation in the case included issues relating to (i) the jurisdiction and venue for resolution of mass tort claims, (ii) the estimation of tort claims, issues regarding the applicability of the bar date to both domestic and international mass tort claimants, and (iii) whether the bar date applied to affect the rights of unborn claimants, and of claimants who might manifest injuries in the future. In addition to issues relating to the intersection of bankruptcy and tort law, myriad other issues arose and were addressed in the bankruptcy case, including those regarding the impact of mass tort claims on the rights of commercial claims, and issues raised concerning the treatment of the claims and whether non-debtor parties could obtain relief under a bankruptcy discharge, or protection from direct and third-party claims. After confirmation of the plan, there were numerous appeals to the confirmation order, and further litigation addressing the resolution of issues regarding late claims, claims by the United States arising under various benefit programs which sought subrogation and reimbursement of costs, and claims for substantial contribution payments by participants in the bankruptcy case. Reported decisions include:

  • In re Dow Corning Corp., 142 F.3d 433 (6th Cir. 1998)
  • In re Dow Corning Corp., 250 B.R. 298 (Bankr. E.D. Mich. 2000)
  • In re Dow Corning Corp., 113 F.3d 566 (6th Cir. 1997)
  • In re Dow Corning Corp., 212 B.R. 258 (E.D. Mich 1997)
  • In re Dow Corning Corp., 215 B.R. 526 (Bankr. E.D. Mich. 1997)


America West Airlines
Represented GE Public Finance as lender to America West Airlines for the construction of the baggage handling system at the new Denver Airport. Successfully obtained payment in full for client before confirmation of plan because of threat of not allowing completion of project.

Bankruptcy Case - Major Airline Company
Represented this major international passenger airline in its historic first Chapter 11 case in Houston in the 1980’s. This case involved precedent setting litigation regarding the status of union contracts in Chapter 11 proceedings.

Nexpak, Inc.
Represent the secured lenders and DIP lenders in the Chapter 11 case of this plastic injection molding company pending in Canton, Ohio. The secured lenders and DIP lenders are owed approximately $165 million.

Galey & Lord
Represent the term agent for the bank group in the Chapter 11 case of this textile company pending in Atlanta, Georgia. The bank group is owed approximately $130 million.

NexBank, SSB
Represents NexBank, SSB and ad hoc second lien lender group in connection with Metroflag workout.

FX Luxury Las Vegas, LLC - Bankruptcy
Representation of second lien agent and certain second lien (junior) lenders in the FX Luxury Las Vegas I, LLC bankruptcy case in the Las Vegas, Nevada bankruptcy court. Successfully obtained ownership for the firm's clients of a seventeen-acre property located on the Las Vegas strip across from City Center.

Bankruptcy Case - Retail
Represented the largest secured and unsecured creditors in the bankruptcy cases of one of North America's and Mexico's leading retail home decor companies.

Memberships

  • American Bar Association
  • New York State Bar Association
  • Texas Bar Association
  • American Bankruptcy Institute

Online Publications

07/09/2013 - Delaware Bankruptcy Court Declines to Designate Votes of Parties
In In re Indianapolis Downs, LLC, the Bankruptcy Court for the District of Delaware provided direction on what constitutes an acceptable "post-petition lock-up agreement" and joined a majority of decisions that have narrowly construed the prohibition in the Bankruptcy Code against post-petition solicitation of a vote for a plan prior to circulation of a court-approved disclosure statement.

04/11/2013 - Weathering the Storm: Seventh Circuit Expands Application of Federal Standard for Successor Liability to FLSA
On March 26, 2013, in the case of Teed v. Thomas & Betts Power Solutions, L.L.C., the Seventh Circuit, in an opinion written by Judge Posner, joined at least one other circuit court and a multitude of district courts across the country in extending the federal common law standard for evaluating successor liability to suits brought under the Federal Labor Standards Act (“FLSA”).

02/13/2013 - Weathering the Storm: Delaware Bankruptcy Court Declines to Designate Votes of Parties to a Post-Petition Restructuring Support Agreement
On January 31, 2013, the Bankruptcy Court for the District of Delaware in In re Indianapolis Downs, LLC declined to designate the votes of parties to a post-petition restructuring support agreement (i.e., a lock-up agreement), instead confirming the Debtors’ Modified Second Amended Joint Plan of Reorganization (the “Plan”) based on the votes of such parties.

05/31/2012 - Supreme Court in RadLAX Rules that Cramdown Plans Providing for Sales of Secured Creditors’ Collateral Must Allow for Credit Bid Rights
In what it described as "an easy decision," the U.S. Supreme Court issued its eagerly anticipated decision in RadLAX Gateway Hotel, LLC et al. v. Amalgamated Bank on May 29, 2012. The high court's 8-0 ruling, delivered by Justice Scalia, held that a Chapter 11 bankruptcy cramdown plan providing for the sale of a secured creditor’s collateral free and clear of the secured creditor's lien may not use Bankruptcy Code § 1129(b)(2)(A)(iii) to deny the secured creditor the right to "credit bid" on its own collateral.

11/04/2011 - Law360 Guest Article: Case Study - In Re Tribune Co.
Law360, New York (November 04, 2011, 4:43 PM ET) -- Halloween provided frights for debtors and a victory for creditors when Judge Kevin Carey issued his opinion in the Tribune Company bankruptcy cases in Delaware.

04/11/2011 - Weathering the Storm: District Court Imposes Additional Duties on Creditors Seeking to Reclaim Goods Sold to a Debtor During the 45-Day Period Preceding the Bankruptcy Case
Vendors who sell goods to customers are probably familiar with the issues that arise when the customer later files bankruptcy. For instance, Section 546(c) of the Bankruptcy Code (and applicable state law) provides a vendor the right to reclaim goods it sold to the customer within 45 days of the bankruptcy petition date.

02/15/2011 - Weathering the Storm: Good News For Lenders – District Court Reverses TOUSA Fraudulent Transfer Opinion
In a welcome bit of good news for lenders, U.S. District Court Judge Gold (Southern District of Florida) reversed the portion of the 2009 bankruptcy court decision in the TOUSA, Inc. bankruptcy cases that had ordered the disgorgement of $403 million plus interest based on the holding that the amounts were received by certain lenders to the TOUSA parent in connection with a pre-petition transaction that constituted a fraudulent transfer.

02/14/2011 - Weathering the Storm: Ability to Gift New Equity to Old Equity through Plan Disapproved in the Second Circuit and Ulterior Motives in Purchasing Debt Could Lead to Designation of Vote
On February 8, 2011, the Second Circuit Court of Appeals issued an opinion that will have a major impact on Chapter 11 plan confirmation.

02/02/2011 - The IP Beacon, February 2011
A Haynes and Boone Newsletter highlighting current issues in Intellectual Property Law.

11/15/2010 - Weathering the Storm: Buyer Beware, Fifth Circuit Rules Purchasers of Reorganized Debtors Liable for Undervalued Claim
In an October 19, 2010 opinion arising out of the Scotia Pacific bankruptcy cases, the Fifth Circuit ruled that reorganized Scotia and its affiliate Pacific Lumber Company were obliged – nearly 2½ years after Scotia’s reorganization plan was consummated – to pay Scotia’s former secured lenders approximately $30 million on account of a mistake made by the bankruptcy judge in calculating the amount owed to the secured lenders for the use of their collateral during the bankruptcy cases.

10/27/2010 - Weathering the Storm: Third Circuit Concurring Opinion Supports Trademark Licensees’ Retention of Rights in Bankruptcy Cases
The concurring opinion in a recent Third Circuit Court of Appeals case suggests that trademark licensees may be able to retain their rights in bankruptcy cases, even if licensors reject the license agreements.

10/19/2010 - Weathering the Storm: Delaware Bankruptcy Court Rules Bid Procedures in Section 363 Sale Were Unfair and Unreasonable
On September 30, 2010, in In re American Safety Razor, LLC, et al., Case No. 10-12351 (MFW), the United States Bankruptcy Court for the District of Delaware ruled that the debtors’ proposed bid procedures for the sale of the business were unfair and unreasonable. The bid procedures, among other things, provided too much discretion to the debtors in the auction process.

10/13/2010 - Weathering the Storm: Court Ruling Won't Allow Secured Creditors To Be Shut Out by Crafty Bid Procedures
On October 5, 2010, Judge Bruce Black of the United States Bankruptcy Court for the Northern District of Illinois (the “Bankruptcy Court”) issued a ruling in the River Road Hotel Partner LLC, et. al. (the “Debtors”) bankruptcy cases denying the Debtors’ bid procedures motion incident to plan confirmation.

04/07/2010 - Weathering the Storm: Does the Bankruptcy Code Restrict a Liquidation Trustee’s Power after Plan Confirmation?
Reversing the decision of the United States District Court for the Northern District of Illinois, the Seventh Circuit (the “Court”) held in Grede v. Bank of New York Mellon, et al., No. 09-3121 (7th Cir. Mar. 18, 2010) that neither the Bankruptcy Code (the “Code”) nor the Supreme Court’s decision in Caplin v. Marine Midland Grace Trust Co., 406 U.S. 416 (1972) apply to the activities of a post-confirmation liquidating trustee appointed in a liquidating trust created by a confirmed plan of reorganization.

03/31/2010 - Weathering the Storm: The Mervyn's Holdings Decision: A Lesson for Sellers and Equity Firms Participating in Leveraged Buyouts
The recent case of Mervyn’s LLC v. Lubert-Adler Group IV, LLC, et al. (In re Mervyn’s Holdings, LLC), serves as a warning to sellers and equity firms participating in leveraged buyouts to be wary of the effect such buyouts will have on creditors of the target company.

03/25/2010 - Weathering the Storm: Third Circuit Ruling on Credit Bidding is Bad News for Lenders
On March 22, 2010, the Third Circuit released its long-awaited ruling in the Philadelphia Newspapers case regarding the applicability of credit bidding. In Philadelphia Newspapers, the proposed plan of reorganization provided for a sale of assets free of the liens of the secured creditors without allowing the secured creditors to credit bid on the assets.

03/11/2010 - Weathering the Storm: Single Asset Real Estate Cases
From 2010 until 2013, approximately $1.4 trillion of commercial real estate loans will mature. This alert discusses the rules governing Single Asset Real Estate (SARE) Chapter 11 cases.

02/23/2010 - Weathering the Storm: The FDIC’s Authority to Repudiate Contracts
The current economic climate has led to a dramatic increase in bank failures over the past few years. In 2009 alone, 140 banks failed, compared to 26 bank failures in 2008 and only 3 bank failures in 2007. The Federal Deposit Insurance Corporation (the “FDIC”) recently announced that it has 702 banks on its “Problem List” as of December 31, 2009, up 27 percent from 552 banks on September 30, 2009. This acute trend has heightened the awareness and interest in the role of the FDIC as receiver of a failed bank.

02/08/2010 - Weathering the Storm: Conditions Precedent in Term Sheets Matter
In a decision that is not surprising, but that should be welcomed by lenders (but perhaps not by borrowers), the Appellate Division of the New York Supreme Court held in Amcan Holdings, Inc., et al. vs. Canadian Imperial Bank of Commerce, et al., Case No. 603393/07, that a detailed, executed term sheet was not a binding contract to lend.

12/22/2009 - Weathering the Storm: Insurance Coverage and Insolvency: Maximizing Recovery In Bankruptcy
While memorable for many things, 2009 may long be remembered as a year of record corporate insolvency. Now more than ever, it is crucial that debtors, creditors, trustees, and, indeed, anyone with an interest in maximizing the financial resources on hand to satisfy debts, understand (1) what coverage may potentially be available; and (2) how to gain access to and maximize this important financial resource.

12/11/2009 - Weathering the Storm: Charter Communications Decision Allows Reinstatement of Debt
Many companies secured their financing several years ago when the credit market featured advantageous pricing and loose loan covenants. Because these favorable terms would be impossible for borrowers to obtain in today’s lending environment, many viable companies with highly leveraged capital structures are looking for strategies to restructure debt. Charter Communications (“Charter”), the country’s fourth largest cable television company, took a gamble during, arguably, the most challenging period in the modern era of global corporate finance.  See how the company's bold moves paid off. 

12/01/2009 - In re General Growth Properties, Inc.: Motions to Dismiss SPE Cases....Denied
In the recent heyday of real estate and structured finance, the use of “bankruptcy-remote” special purpose entities (“SPEs”) as borrowers was a fundamental underwriting requirement by lenders, and a critical factor considered by ratings agencies, to shield lenders and their collateral from the potentially adverse impact of bankruptcy filings by their borrowers’ parents and affiliates.

10/21/2009 - Weathering the Storm: Savings Clauses: Fraudulent Transfer Issues in the TOUSA Bankruptcy Case
The judge's ruling in the October 13, 2009 TOUSA, Inc. bankruptcy cases raises a number of troubling issues for commercial lenders, including but not limited to, the judge calling into question the enforceability of fraudulent conveyance “savings clauses,” common in commercial loan agreements.

10/14/2009 - Managing Maturing Debt and Refinance Risks in the Private Equity Real Estate Market
Presentation on current issues in the private equity real estate market for iGlobal Forum's 3rd Real Estate Private Equity Summit, New York City, October 14, 2009.

09/09/2009 - Weathering the Storm: Guidelines Issued for Private Equity Investors Acquiring Failed Banks or Thrifts
The interest from the private equity community in filling the growing capital gaps that exist in the balance sheets of U.S. banks has spurred the FDIC Board to adopt a Final Statement of Policy on Qualifications for Failed Bank Acquisitions (the “Policy Statement”). The Policy Statement, published on September 2, 2009, provides private equity investors with guidelines for acquiring failed banks or thrifts.

08/25/2009 - Weathering the Storm: Recent Court Decision Exposes the Reach of a Corporate Family’s Financial Distress to its Bankruptcy-Remote Special Purpose Entities and Their Lenders
In the recent heyday of real estate and structured finance, the use of “bankruptcy-remote” special purpose entities (SPEs) as borrowers was a fundamental underwriting requirement by lenders in many loans, and a critical factor considered by ratings agencies, to shield lenders and their collateral from the potentially adverse impact of bankruptcy filings by their borrowers’ parents and siblings.

07/20/2009 - Weathering the Storm: Fiduciary Duties of Officers and Directors in Troubled Company Situations
Directors and officers managing corporations, especially when the corporation is insolvent or operating in insolvency situations, need to be cognizant of their fiduciary duties. This alert provides a brief overview of these fiduciary duties, including practical considerations in the exercise of these duties.

07/01/2009 - Weathering the Storm: The Appointment of an Examiner
With the economic crisis leading to the failure of many businesses, bankruptcy cases are on the rise. In many of the cases grabbing headlines, such as Lehman Brothers, Nellson Nutraceutical, New Century and SemCrude, courts have shown a willingness to appoint examiners to investigate, report on and make recommendations regarding possible issues of mismanagement, fraud or other improprieties relating to the affairs of the debtor or its former or current management.

06/25/2009 - Weathering the Storm: Top 10 Practical Things to Know about Bankruptcy
Bankruptcy is a highly specialized legal practice area that can be difficult for the non-lawyer to navigate. Bankruptcy can also present many traps for the unwary. A bankruptcy or distressed financial situation will in most cases materially affect a company’s key relationships, customers, suppliers and business partners. All company decision makers need an understanding of how to react to protect their organization’s interests. Here are ten practical considerations to recognize in this distressed environment.

06/19/2009 - Weathering the Storm: Options to Remove Liabilities for High Retiree Medical Costs from a Company’s Balance Sheet: VEBAs
High legacy costs for retiree medical benefits, along with Financial Accounting Standards Board Standard No. 158, which requires balance sheet recognition of such liability, has forced many companies to face the true size of the retiree medical obligations and to consider ways to reduce or limit costs.

06/12/2009 - Weathering the Storm: Look Out Lenders—Collecting Fees For Loaning Money May Be Considered Evil
In a recent case, a Bankruptcy Court in Montana equitably subordinated a pre-bankruptcy secured lender’s first lien claims to the claims of the DIP lender and the unsecured creditors even though the lender did not owe any fiduciary duties to the debtor or any of the debtor’s potential creditors.

05/27/2009 - Weathering the Storm: Retiree Benefits and Section 1114
Retiree benefits are often a central issue in bankruptcy cases. For many employers the high cost of retiree medical benefits has been a significant contributing factor to the Chapter 11 filing and a matter of ongoing concern if the debtor is to be able to successfully reorganize. Understandably, employees, retirees and unions are equally concerned about the status of retiree benefits. This alert discusses Section 1114 of the Bankruptcy Code.

05/21/2009 - Weathering the Storm: Are Your Deposits Insured?
The Federal Deposit Insurance Corporation (the “FDIC”) is celebrating its 75th anniversary this year, and due to the economic downturn, 2009 will pose a substantial challenge to the FDIC. FDIC Chairman Sheila C. Bair said in a recent speech that “No one has ever lost a penny of an insured deposit.” President Obama stated during his first address to a joint session of Congress, “You should also know that the money you’ve deposited in banks across the country is safe; your insurance is secure; you can rely on the continued operation of our financial system. That is not a source of concern.” These two quotes help set the tone that the Government stands behind the security of “insured” deposits.

05/07/2009 - Weathering the Storm: Modifying Your Company’s Debt: Tax Trap or Treasure?
Debtors increasingly are requesting that their creditors modify the terms of their debts because of difficulty or inability to service their debts in accordance with the debts’ existing terms. Faced with the prospect of debtor defaults and having to foreclose on property securing their loans causing the accrual of financial losses, creditors, too, often have an incentive to restructure debt to maximize their returns.

04/23/2009 - Weathering the Storm: Recent Decision Affects Setoff Under Netting Agreements
Companies that engage in multiple transactions with different entities of related groups often enter into contractual netting agreements that allow the setoff of obligations between entities within the groups. The effectiveness of these agreements has been called into question by a recent decision of a bankruptcy court in Delaware, which refused to allow a party to a contractual netting agreement to offset its obligations to the debtors against obligations of the debtors under the netting agreement. Parties to such netting agreements may have to reconsider how to structure such agreements and how to defend their effectiveness in court.

04/15/2009 - Weathering the Storm: Great Deals Now Available in Bankruptcy Court
Whether you are interested in purchasing assets or a going concern, bankruptcy court can be a land of opportunity. Assets may be sold by a trustee, or someone the trustee retains, in a Chapter 7 liquidation, or by a Debtor-in-Possession (a “DIP”) in a Chapter 11 reorganization case. In either case, you should expect a competitive bidding process.

04/09/2009 - Weathering the Storm: Terminations, Uncertainty, and Strategies to Reduce Workplace Liability
In the current economic state, many employers are seeking to reduce operating costs. More employees are being let go as corporate layoffs have accelerated and workers are looking to complain that they have been unfairly or improperly dismissed. The Obama administration has publicly announced that it will be more aggressive in enforcing employment laws.

04/01/2009 - Weathering the Storm: Bankruptcy - Pay Attention from the Start Because Things Happen Fast
When a company files bankruptcy, it is crucial to closely monitor the bankruptcy proceedings from the beginning. After filing its petition, the debtor will likely file numerous “first day motions” intended to stabilize the Debtor’s business and facilitate an efficient case administration. These motions can severely affect the rights of unwary creditors who may find their interests primed by the actions of the debtor in the first few days of the case.

08/30/2007 - Enron--Appellate Court Overturns Ruling on Equitable Subordination and Claims Disallowance
‘Taint Clear: “Purchased” Claims are Not Subject to Equitable Subordination or Disallowance Based Solely on Seller’s Conduct, but Purchaser’s Knowledge of the Seller’s Conduct May Be Fatal

04/12/2007 - Supreme Court Holding Allows Bankruptcy Proofs of Claim to be Amended to Recover Attorneys' Fees
On March 20, 2007, the United States Supreme Court issued a unanimous opinion in Travelers Casualty & Surety Co. of America v. Pacific Gas & Electric Co., No. 05-1429, 2007 WL 816795 (March 20, 2007), holding that a creditor may supplement its unsecured claim in a bankruptcy case to recover contract-based attorneys’ fees incurred during the bankruptcy case through the litigation of bankruptcy law matters.

01/14/2002 - Enron Bankruptcy: Purchasing Assets from Enron and its Subsidiaries and Affiliates
Enron announced in court Friday, January 11, that it had selected UBS Warburg’s bid for its wholesale commodity trading business.  Many details concerning the sale remain to be resolved through the bankruptcy court process. Importantly for Haynes and Boone’s energy clients, there are many other Enron assets remaining on the auction block. 

12/06/2001 - Enron Bankruptcy: Producer's Rights Under Product Purchase Contracts- Royalty Payments

12/05/2001 - Enron Bankruptcy: Counter-Party Rights Under Derivative Contracts
The bankruptcy filing by Enron Corp. and several of its subsidiaries, including its principal energy trading subsidiary, creates a number of issues for our clients, including those clients who are in the exploration and production business and who have entered into financial and physical swaps, puts and other derivative contracts with Enron or one of its subsidiaries.