Practice Areas

Bankruptcy & Reorganization

At more than 530,000 words, the U.S. Bankruptcy Code and the Federal Rules of Bankruptcy Procedure are roughly the same length as Tolstoy’s War and Peace. And every year, 350 judges take on a million new bankruptcy cases, providing tens of thousands of opinions that further expand that universe of knowledge. When business interests collide with the world of bankruptcy, experience is essential.

Identifying Business Solutions

We begin every engagement by identifying for each client a range of possible outcomes, and charting a path to achieve an optimal business solution, whether in or out of bankruptcy court.  As conditions inevitably change, we continue to work with clients to identify opportunities to maximize outcomes.  

Debtor Representation

For enterprises seeking relief as a debtor, whenever possible we concentrate on revitalizing businesses and optimizing potential for success after reorganization.  The United States Congress recently enacted the most sweeping changes to the Bankruptcy Code in more than a decade in passing the Small Business Reorganization Act.  The Act took effect in February 2020, and provides a less costly and less time-consuming alternative to traditional Chapter 11 reorganizations for small businesses.  On March 27, 2020, Congress enacted the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) which temporarily increased the debt limits for companies seeking bankruptcy relief as a small business from roughly $2.7 million to $7.5 million.  We can assist small and mid-size businesses in taking advantage of this opportunity to restructure their financial affairs.  

On the other hand, sometimes market conditions render a reorganization impracticable, and in these instances, we are able to assist small businesses with the orderly liquidation of assets.  

Creditor Representation

Most businesses enter the bankruptcy realm when a struggling borrower, customer, lessee or contract counter-party seeks debt relief.  For secured creditor clients, our goals may involve recovery of collateral by seeking relief from the automatic stay or compelling debtors to offer “adequate protection” payments during the pendency of their case.  Alternatively, we may look to maximize returns by compelling a sale of collateral within a bankruptcy proceeding.  

When creditors lack collateral, our focus may shift to maximizing distributions through a plan of reorganization or compelling the liquidation of unencumbered assets.  

We have represented creditors in a variety of industries, including Aviation, Banking, Commercial Laundry, Construction, Entertainment, Gaming and Hospitality, Golf Courses, Health Care, Intellectual Property, Manufacturing, Mining, Mortgage Servicing, Real Estate Development, Retail, and Telecommunications.  

Lessors face particular challenges as the only creditor in bankruptcy that is often forced to involuntarily extend credit in the early stages of a case when a debtor refuses to pay rent, taxes or common area maintenance charges.  We assist lessor clients by compelling compliance with lease documents, while preserving non-monetary interests, including such things as preserving proper tenant mixes and observing use restrictions.  

When a debtor is a counter-party to an agreement requiring future performance, we recognize that uninterrupted performance is often critical, and we act to ensure that non-debtor parties to an agreement are not adversely affected by a filing.

Committee Representation

In larger Chapter 11 cases, the Office of the U.S. Trustee will typically appoint a committee to represent the interests of the entire class of unsecured creditors.  We have acted as counsel to creditors’ committees in cases in a number of industries.  By acting collectively through a committee, unsecured creditors can often exercise considerable control over the outcome of a reorganization proceeding, with debtors typically assuming responsibility for payment of fees.  

Bankruptcy Transactions

Our approach to insolvency cases is perhaps most obvious when representing parties in business transactions occurring in bankruptcy proceedings.  When a debtor seeks to compel the sale of an asset within a bankruptcy case, we often represent secured creditors and act to ensure that they are receiving full value for their collateral and a timely distribution.  On the other hand, we also represent purchasers of assets in bankruptcy cases, who are often concerned with details beyond price, including ensuring that assets are conveyed “free and clear” of interests.  We represent lenders in connection with “Debtor-in possession financing” who are often focused on lien priority.  

Bankruptcy Litigation

We often represent businesses that find themselves involved in lawsuits occurring within a reorganization, even if no debtor-creditor relationship may have existed.  We represent trade vendors alleged to have received “preference” payments prior to a filing, and we represent directors, officers, shareholders and other insiders alleged to have received “fraudulent” transfers.  

Bankruptcy Alternatives

Finally, and perhaps most importantly, our depth of experience allows us to recognize when the best option for dealing with insolvency issues calls for remaining outside bankruptcy court.  We often represent parties in out-of-court workouts, including in industries in which federal law may not allow for access to the Bankruptcy Court, such as cannabis.  For lenders, we have a very active practice in our State courts involving receiverships.