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Executory Contracts

Falcon Rappaport & Berkman LLP

Michigan Bankruptcy Court Holds That a Non-Compete Clause Survives the Rejection of an Executory Contract and That a...

In a recent decision of interest, the Bankruptcy Court for the Eastern District of Michigan held that a non-compete clause within a franchise agreement as well as confidentiality agreement could not be rejected as an...more

Lewitt Hackman

Franchisee 101: Non-Compete Jumpstarted in Bankruptcy

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A Michigan bankruptcy court held that a debtor-franchisee seeking to reject a franchise agreement for an auto repair center could not reject either a stand-alone confidentiality agreement with the franchisor or the...more

Nutter McClennen & Fish LLP

Tenant’s Rights When Its Commercial Landlord Seeks Chapter 11 Protection

Financial distress persists in the commercial real estate market, raising the prospects that property owners and landlords could seek relief under chapter 11 of the Bankruptcy Code. The Bankruptcy Code contains numerous...more

Troutman Pepper

What Are Some Less Traditional Defenses to a Preference Action? - Creditor’s Rights Toolkit

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The ordinary course of business, new value, and contemporaneous exchange for new value defenses are the most frequently used defenses in a preference action. However, there are additional, less common defenses that a...more

Troutman Pepper

Should I Care That the Debtor Has Filed a Motion to Sell Its Assets? - Creditor’s Rights Toolkit

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Sales under Section 363 of the Bankruptcy Code have become commonplace in bankruptcy cases as a mechanism to liquidate a debtor's assets and maximize value for creditors. Selling the debtor's assets to a third party offers...more

Goodwin

Top 10 Questions About Bankruptcy Sales - A Primer on Sales Under Section 363 of the Bankruptcy Code

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A bankruptcy sale is an opportunity to potentially acquire assets at distressed pricing. A bankruptcy sale also presents prospective bidders with a level playing field to conduct due diligence, submit a bid, and compete...more

Lathrop GPM

Bankruptcy Court Grants Motion of Franchisee Debtor to Reject Franchise Agreement, Concludes Noncompete and Confidentiality...

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A Michigan bankruptcy court recently granted debtor/franchisee Empower Central Michigan Inc.’s motion to reject a franchise agreement as an executory contract but found that a non-compete clause and a related confidentiality...more

Ervin Cohen & Jessup LLP

Are IRS Claims Junior to Receivership Administrative Expenses?

Q: I was appointed receiver over a manufacturing facility. I operated it for a short time and then obtained court authority to sell it. I netted $1.4 million from the sale. The landlord agreed I could pay it the rent I owed...more

Jones Day

Texas Bankruptcy Court: Debtor's Non-Economic Rights Under LLC Agreement Are Estate Property Protected by Automatic Stay

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The Bankruptcy Code invalidates "ipso facto" clauses in executory contracts or unexpired leases that purport to modify or terminate the contract or lease (or the debtor's rights or obligations under the contract or lease)...more

Holland & Knight LLP

The Real Estate and Corporate Restructuring Connection, Plus Retail Restructuring Trends

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The transition to online shopping, interest rate increases, labor costs, maturing debt and rising inflation have collectively taken a significant toll on the retail industry, contributing to store closures and a growing...more

Pillsbury Winthrop Shaw Pittman LLP

Not So Fast: An Option to Purchase Real Estate May Not Always Be Rejected by the Debtor in Bankruptcy

A recent bankruptcy court decision determined that a debtor cannot reject an unexercised option for the purchase of its real estate, raising a potentially significant bar to any debtor extricating itself from an under-market...more

Foley & Lardner LLP

Trademark Law and Bankruptcy Considerations for Emerging Companies in the Renewable Energy Sector

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As the renewable energy sector continues to experience significant growth and attract emerging companies, it becomes essential for entrepreneurs and business owners to understand the legal landscape surrounding trademarks and...more

Proskauer - Employee Benefits & Executive...

Pre-Petition Settlement Agreement Not an Assumable, Assignable, Executory Contract

In Svenhard’s Swedish Bakery v. United States Bakery, Bk. No. 19-15277, 2023 WL 5541420 (9th Cir. Aug. 29, 2023), the Ninth Circuit held that a settlement agreement that resolved an employer’s withdrawal liability to a...more

A&O Shearman

Diamond Sports Group swings for the fences (and strikes out)

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During a U.S. bankruptcy case, can a debtor pay something less than the full contract rate provided for in a contract entered into prior to the bankruptcy while still requiring the counterparty to fully perform its...more

Cadwalader, Wickersham & Taft LLP

Does WeWork’s Going Concern Warning Signal a Potential Bankruptcy Filing?

Three years have passed since the COVID-19 pandemic reached the United States and its effects are still being felt today.  Even though lockdown measures have largely disappeared and many workers have returned to the office,...more

Hogan Lovells

Second Circuit holds that general contractor doesn’t have to be satisfied in full for real estate developer to assume and assign...

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In a recent decision, the Second Circuit held that only parties with the right to pursue a breach of contract claim under an executory contract or unexpired lease have the right to demand a cure payment in the event the...more

Dechert LLP

Maybe You are Entitled to a Cure Payment, or Maybe Not?

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The Second Circuit recently held that a non-party to an assumed executory contract is not entitled to a cure payment (although it may be so entitled if is a third-party beneficiary of the contract). The result would have...more

Morrison & Foerster LLP

Navigating Contracts with FDIC Receiverships and Bridge Banks

In the wake of two bank failures last week, the Federal Deposit Insurance Corporation (“FDIC”) was appointed as receiver for each failed bank (“Receiver”). The Receiver subsequently transferred all deposits (both insured and...more

Cole Schotz

Considerations if Your Customer is Potentially Facing Bankruptcy

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With the recent uptick in Chapter 11 filings and a further increase expected in the coming quarters, companies across all industries would be wise to consider certain precautionary measures if a customer begins missing or...more

Holland & Knight LLP

Court Orders Avianca to Comply with Post-Petition Lease Obligations Payable to Non-Lessors

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Bankruptcy Code Section 365(d)(5) provides personal property lessors with important rights concerning lease payments that come due after a lessee commences a U.S. bankruptcy proceeding. Generally, that section requires that...more

Pillsbury Winthrop Shaw Pittman LLP

Denial of Assumption of Pre-Bankruptcy Workout Agreement Demonstrates How Settlement Value Can Change with Time and Circumstances

The bankruptcy court’s decision in Svenhard’s provides a path forward for potentially increased creditor recoveries. To assume an agreement under section 365, the agreement must be an “executory contract,” which generally...more

Goodwin

Top 10 Questions For Landlords to Ask When a Tenant Files for Bankruptcy

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As uncertain economic times continue, particularly in the retail sector, commercial tenant bankruptcies are on the rise. Goodwin’s Financial Restructuring group presents 10 questions (and related practice points) for...more

Greenberg Glusker LLP

When it Comes to Assuming Executory Contracts, a Default is a Default; But the Equities Still Matter

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The recent decision of the Ninth Circuit in In re Hawkeye Entertainment, LLC contains a few important takeaways with respect to the treatment of executory contracts and unexpired leases under section 365 of the Bankruptcy...more

McGlinchey Stafford

Is My Contract Void? - McGlinchey Commercial Law Bulletin - October 11, 2022

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Ohio- Implied Warranty Banks v. Shark Auto Sales LLC, 11th Dist. Trumbull, No. 2022-Ohio-3489- In this appeal, the Eleventh Appellate District reversed the trial court’s judgment in favor of the plaintiff on her vehicle...more

Nelson Mullins Riley & Scarborough LLP

Bankruptcy Court Continues to be a Battleground on Key Healthcare Provider Issues

The intersection between Medicare and state Medicaid regulatory schemes on the one hand and bankruptcy proceedings on the other continues to be an interesting, often highly contested, source of bankruptcy litigation. In...more

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