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southern district of new york

Continental Casualty Co. v. Pfizer Inc. (In re Quigley Co.)

Ruling
Relief from stay granted to allow arbitration of asbestos-related insurance claims.
Procedural posture

Defendants, chapter 11 debtor and its parent company, moved to dismiss plaintiff insurers'complaint, which sought a declaratory judgment that the policies issued to debtor did not cover asbestos-related claims and challenged the proposed assignment of rights in the policies to a trust. Defendant insurance companies sought relief from the automatic stay, 11 U.S.C. § 362, to allow arbitration of the coverage issues raised in the complaint.

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opinion summary, case decided on February 22, 2007 , LexisNexis #0307-127

West v. WorldCom Inc.

Ruling
Action against debtor for continuing trespass related to maintenance of fiber optic cable was not discharged in bankruptcy.
Procedural posture

Petitioner property owner filed an action alleging trespass, slander of title, and unjust enrichment based on the installation of fiber optic cable within railroad rights of way. Respondent debtor filed for bankruptcy. The debtor sought a declaratory judgment that a discharge precluded the owner's action. The bankruptcy court granted the debtor's motion for summary judgment. The owner appealed.

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opinion summary, case decided on February 13, 2007 , LexisNexis #0307-030

In re Food Mgmt. Group LLC

Ruling
Motion to seal trustee's adversary complaint as defamatory or scandalous denied absent establishment that allegations were untrue.
Procedural posture

A putative defendant, a law firm, sought an order pursuant to 11 U.S.C. § 107(b)(2) requiring that the chapter 11 trustee be required to file a proposed adversary complaint under seal.

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opinion summary, case decided on February 13, 2007 , LexisNexis #0307-019

In re Nichols

Ruling
Bankruptcy court had authority to excuse compliance with credit counseling requirement in appropriate cases.
Procedural posture

Citing 11 U.S.C. § 109(h), 11 U.S.C. § 521(b), 11 U.S.C. § 707(a), the U.S. trustee asked the court to dismiss two chapter 7 petitions filed by unrelated debtors based on a claim that debtors in each case failed to comply with the credit counseling requirement in 11 U.S.C. § 109(h)(1). At issue was whether the court had express or implied power to excuse such noncompliance.

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opinion summary, case decided on February 09, 2007 , LexisNexis #0307-107

Comair Inc. v. Air Line Pilots Assoc. (In re Delta Air Lines Inc.)

Ruling
Debtor airline's rejection of collective bargaining agreement with pilot's union allowed court to issue strike injunction without violating the Norris-LaGuardia Act.
Procedural posture

Plaintiff airline, a bankruptcy debtor, obtained approval to reject a collective bargaining agreement between the airline and defendant airline pilots'union. After the union expressed an intent to strike if the airline implemented proposed new terms of employment, the airline brought an adversary proceeding against the union and moved for a preliminary injunction to prohibit the union and its members from striking.

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opinion summary, case decided on February 07, 2007 , LexisNexis #0307-029

Adams v. Marwil (In re Bayou Group LLC)

Ruling
As court appointed federal equity receiver could continue to manage debtor postpetition appointment of chapter 11 trustee was not necessary.
Procedural posture

Appellant, Acting U.S. Trustee, sought review of an order of the bankruptcy court denying the U.S. Trustee's motion for the appointment of a chapter 11 trustee for debtors, an affiliated group of limited liability companies that created and managed hedge funds.

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opinion summary, case decided on February 05, 2007 , LexisNexis #0307-013

ACC Bondholder Group v. Adelphia Communs. Corp. (In re Adelphia Communs. Corp.)

Ruling
Stay pending appeal granted where appellants' arguments that plan did not satisfy best interests of creditors test had substantial probability of success.
Procedural posture

In an action arising out of jointly administered chapter 11 cases of a parent company and its subsidiaries (collectively referred to as the debtors), appellant objectors, who were holders of notes issued by the parent company, filed a motion pursuant to Fed. R. Bankr. P. 8005 for a stay pending appeal and an expedited appeal with respect to a bankruptcy court's confirmation order approving the debtors'chapter 11 reorganization plan.

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opinion summary, case decided on January 24, 2007 , LexisNexis #0307-066

In re Green

Ruling
"Hanging paragraph" did not apply to trailer and secured creditor's claim could be bifurcated.
Procedural posture

Creditor filed an objection to the confirmation of chapter 13 debtor's plan.

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opinion summary, case decided on January 12, 2007 , LexisNexis #0207-047

In re Adelphia Communs. Corp.

Ruling
Franchisee rights to consent to assignment and certain rights of first refusal were enforceable pursuant to "applicable law" exception.
Procedural posture

The court had before it the executory contract assignment issues, under 11 U.S.C. § 365, associated with debtors'contemplated transfer of their cable operations to affiliates of two asset purchase buyers. Though debtors had been able to consensually resolve the section 365 issues with all but about 14 of the approximately 2,500 local franchising authorities ("LFAs") that had issued franchises, issues with respect to the remaining 14 remained.

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opinion summary, case decided on January 11, 2007 , LexisNexis #0207-091

Gredd v. Bear Stearns Sec. Corp. (In re Manhattan Inv. Fund Ltd.)

Ruling
Transfers by debtor to brokerage firm with intent to hinder, delay or defraud creditors were avoidable.
Procedural posture

Chapter 11 trustee and defendant brokerage firm filed cross-motions for summary judgment in trustee's action, which sought to avoid margin payments deposited in debtor's account at the firm pursuant to 11 U.S.C. § 548(a)(1)(A).

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opinion summary, case decided on January 09, 2007 , LexisNexis #0207-061