Delaware Chancery Law Blog
The Delaware Court of Chancery is widely considered the preeminent forum for resolving disputes involving the internal affairs of the multitude of Delaware corporations and other business entities through which a vast amount of the world's commercial affairs is conducted. Join Carl as he helps guide you through the complex landscape of legal issues and analysis arising before this Court.
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Delaware Bankruptcy Litigation Blog
Carl shares his knowledge of Delaware bankruptcy proceedings in a blog entitled, "Delaware Bankruptcy Litigation." He offers his take on corporate bankruptcy proceedings not only in Delaware but throughout the United States, as well as industry insight on topics such as preference litigation, tenant bankruptcy and defending avoidance litigation.
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Recent Blog Posts

  • Delaware Dissolution Proceeding Dismissed in Favor of Prior Pending Litigation A question that is often posed to Delaware corporate practitioners is whether a non-Delaware court can dissolve a Delaware entity.  Certain jurisdictions, such as Texas, will generally decline to dissolve a foreign entity, while others will do so if the entity’s principle place of business is in that state. The recent transcript decision of Zebala v. Aminopterin LLC, C.A. No. 12186-VCS (Del. Ch. Sept. 28, 2016) involved this issue.  Prior to the filing of the Chancery action, litigation in California had been pending... More
  • Limitless Mobile, LLC Files for Chapter 11 Protection On December 2, 2016, Limitless Mobile, LLC (“Limitless” or the “Debtor”) filed a chapter 11 voluntary petition in the United States Bankruptcy Court for the District of Delaware.  The Debtor was formed in 2013 to provide broadband and wireless telecommunication services in certain rural counties in central Pennsylvania.  The Debtor is part of a worldwide corporate family referred to as the Limitless Group.  According to the First Day Declaration, Limitless intends to wind down its retail-side business and emerge from... More
  • Ninth Circuit Requires Debtors to Pay Interest at Default Rate to Cure Default In the recent decision of Pacifica L51 LLC v. New Invs., Inc. (In re New Invs., Inc.), 2016 WL 6543520 (9th Cir. Nov. 4, 2016), the Ninth Circuit held that section 1123(d) legislatively overruled Great W. Bank & Tr. v. Entz-White Lumber & Supply, Inc. (In re Entz-White Lumber & Supply, Inc.), 850 F.2d 1338 (9th Cir. 1988), and required debtors to pay interest at the default rate in order to cure a default pursuant to a plan of reorganization. The debtor defaulted on... More
  • Telephonic Appearances Before Judge Gross Now Through CourtSolutions LLC Effective January 2, 2017, all telephonic court appearances before the Honorable Kevin Gross of the United States Bankruptcy Court for the District of Delaware will be through CourtSolutions LLC.  The alert was issued by the Court today on November 30th.  Click here for a copy of the notice. Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  You can reach Carl at (302) 622-4272 or at [email protected]... More
  • American Apparel Files Second Bankruptcy in Just Over a Year Made-in-the-USA retailer American Apparel, LLC and its affiliated entities (“Debtors”) filed for Chapter 11 bankruptcy protection on Monday, Nov. 14th for the second time in just over a year, colloquially known as the “Chapter 22”.  The filing comes just about a year after the fashion retailer previously filed for bankruptcy, when the company exited court protection in early 2016 but quickly encountered trouble again. Canadian clothing manufacturer Gildan Activewear has agreed to a $66 million deal to acquire intellectual property assets and... More
  • Ordinary Course Defense Examined by the 7th Circuit – Bucketing Analysis Rejected In the recent decision of Unsecured Creditors Comm. of Sparrer Sausage Co., Inc. v. Jason’s Foods, 826 F.3d 388 (7th Cir. 2016), the Seventh Circuit overturned the bankruptcy court’s application of the “bucketing” method to assess an ordinary-course defense to preference liability, concluding that range of invoice payment dates chosen as the baseline was arbitrarily narrow. Jason’s Foods, a wholesale meat supplier, provided meat products to Sparrer Sausage, a sausage manufacturing company.  Their relationship stretched back two years before Sparrer filed for... More
  • Interest Payments Do Not Qualify as Protected Settlement Payments Under Section 546(e) In the decision of Motors Liquidation Co. Avoidance Action Trust v. JPMorgan Chase Bank, N.A. (In re Motors Liquidation Co.), 552 B.R. 253 (Bankr. S.D.N.Y. 2016), the SDNY bankruptcy court held that prepetition interest payments on a term loan did not qualify as “settlement payments” under Section 546(e) of the Bankruptcy Code.  The court also found that the record did not establish whether they qualified as transfers in connection with a securities contract within the meaning of section 546(e). By way of... More
  • Enlargement of Word Count Requires Good Cause The recent letter order issued in the case of Kandell, et al. v. Niv, et al., C.A. No. 11812-VCG (Del. Ch. Oct. 14, 2016) illustrates the Court’s disfavor when parties stipulate to expand the word count of a brief on the eve of a briefing deadline.  In order to avoid jeopardizing the briefing schedule, the Court granted the request, but with these words of caution: Please be aware, however, that a motion to extend the word limit should be brought to... More
  • Fees Granted in Dell Inc. Appraisal Action In the Dell Inc. appraisal action, the Court previously held that the fair value of Dell common stock at the effective time of the merger was $3.87 per share more than the merger price.  For a link to a prior post discussing the decision, click here.  The appraisal statute authorizes a party that has incurred expenses litigating an appraisal to have its expenses, including reasonable attorneys’ fees, allocated pro rata among the shares comprising the appraisal class. The recent decision of... More
  • Sanjel (USA) Inc. – Chapter 15 Creditors May Challenge Reach of Stay in Recognition Order A recent decision by the United States Bankruptcy Court for the Western District of Texas in In re Sanjel (USA) Inc., et al., Case No. 16-50778-CAG (Bankr. W.D. Tex. July 29, 2016) explains that in a Chapter 15 case, the U.S. bankruptcy court will not always apply the law of the foreign jurisdiction to U.S. creditors and U.S.-based claims.  Specifically, the case addresses whether it is appropriate for a bankruptcy court to modify or limit a foreign stay through changes to... More
  • United States Trustee Meeting Room Change According to the United States Bankruptcy Court for the District of Delaware’s website, the meeting room for the United States Trustees has been changed from the second floor room 2112 to the third floor room of 3209 in the J. Caleb Boggs Federal Building, 844 N King Street, Wilmington DE 19801. The change went effective October 4th, 2016. Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  You can reach Carl at (302) 622-4272 or at [email protected]... More
  • Local Rules Comment Period According to the United States Bankruptcy Court for the District of Delaware’s website, the Court has instituted an annual process to review and consider comments and revisions to its Local Rules.  See announcement here.  The comment period is October 1, 2016 through October 31, 2016.  All comments received will be considered by the Local Rules Committee. Revisions to the Local Rules will be effective February 1, 2017. Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  You can reach Carl... More
  • Mootness Fees Granted to Stockholder Challenging Bylaw Provision In the recent decision of Jay Frechter v. Cryo-Cell International, Inc., Civil Action No. 11915-VCG (Del. Ch. Oct. 7, 2016), the Court of Chancery granted a mootness fee in connection with a lawsuit brought by a stockholder challenging a bylaw provision.  The bylaw provision at issue indicated that directors could be removed “for cause” at a “special meeting” of stockholders.  The plaintiff asserted that under Section 141(k) of the Delaware General Corporation Law, stockholders have the right to remove directors without cause, and... More
  • Chancery Distinguishes Pre- and Post-Close Disclosure Claims The recent decision of Nguyen v. Barrett, C.A. No. 11511-VCG (Del. Ch. Sept. 28, 2016) provides a useful discussion of pre- and post-close disclosure claims.  The action involved a challenge to a merger agreement, brought pre-close, alleging inadequate price and process, as well as some thirty disclosure violations.  However, in plaintiff’s motion for preliminary injunctive relief, the Plaintiff pursued only his “serious” disclosure violation, involving lack of disclosure of purportedly material financial information. The Court denied the preliminary injunction motion. The... More
  • Delaware Bankruptcy Court Now on Twitter The Delaware Bankruptcy Court announced recently that it is now on Twitter.  You can follow the Court and receive various updates here: Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  You can reach Carl at (302) 622-4272 or at [email protected]... More