Arlington Capital LLC v. Bainton McCarthy LLC

(N.D. Ind. June 26, 2015)

The district court affirms the bankruptcy court’s approval of the attorney fee application. The law firm was retained by the trustee to pursue a 11 U.S.C. § 363(n) claim against the purchaser of the chapter 11 debtor’s assets for colluding with bidders to set the sale price. The defendant argued the award of attorney fees was inappropriate because they were not incurred for services “reasonably likely to benefit the debtor’s estate,” as a secured creditor had a lien on the property sold and thus should have recovered any difference between the sale price and the actual value of the property sold. The court holds that the recovery would be “after acquired property” under § 552(a) and thus property of the estate. As such, the attorney fees were incurred to benefit the debtor’s estate. Opinion below.

2015-06-26 – arlington capital llc v bainton mccarthy llc

Author: Matt Lindblom

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