Whirlpool Corporation v. HHGreg, Inc. (In re HHGregg, Inc.)

(Bankr. S.D. Ind. Dec. 4, 2017)

The bankruptcy court grants the motion to dismiss, finding the defendant’s security interest in the debtor’s assets, including its inventory, has priority over the plaintiff’s reclamation rights. The plaintiff sold goods to the debtor up to the petition date and sought either return of the goods delivered within the reclamation period or recovery of the proceeds from the sale of such goods. Pursuant to 11 U.S.C. § 546(c), the Court finds the reclamation rights are subordinate and the complaint should be dismissed. Opinion below.

Judge: Jeffrey J. Graham

Attorneys for Plaintiff: Warner Norcross & Judd LLP, Robert Michael Azzi, Stephen B. Grow, Janet L. Ramsey; Rubin & Levin, P.C., Joshua W. Casselman, James E. Rossow, Jr.

Attorneys for Defendants: Ice Miller LLP, Adam Arceneaux, Sarah Lynn Fowler, Jeffrey A. Hokanson; Morgan Lewis & Bockius LLP, Andrew Joseph Gallo, Neil E. Herman; Choate Hall & Stewart LLP, Mark D. Cahill, Sean Monahan, John Ventola; Faegre Baker Daniels LLP, Terry E. Hall, Jay Jaffe; DLA Piper LLP, David E. Avraham, Stuart M. Brown, Jeffrey Scott Torosian

2017-12-04 – in re hhgregg

Author: Matt Lindblom

Sunshine Heifers, LLC v. Citizens First Bank (In re Purdy)

(6th Cir. Aug. 31, 2017)

The Sixth Circuit affirms the bankruptcy court’s decision finding the bank had a superior interest in the proceeds of an auction of the debtor’s cattle. The appellant contended its interest as lessor was superior and that the Sixth Circuit had already determined it was entitled to the proceeds. The bankruptcy did not err in determining ownership of the cattle at the time of the auction after the prior remand. Opinion below.

Judge: Moore

Attorneys for Appellant: Keller & Almassian, Michael D. Almassian, Nicholas S. Laue

Attorneys for Bank: Kerrick Bachert PSC, Scott A. Bachert, Ashley D. Gerughty

2017-08-31 – in re purdy

Author: Matt Lindblom

Czyzewski v. Jevic Holding Corp.

(U.S. Sup. Ct. Mar. 22, 2017)

The Supreme Court holds that a distribution scheme ordered by the bankruptcy court as part of a dismissal of a Chapter 11 case (i.e., a “structured dismissal”) cannot deviate from the basic priority rules in the bankruptcy code, without the consent of affected parties. The Court recognizes that the code gives a bankruptcy court the power to dismiss a Chapter 11 case, but there is no statutory language that supports a dismissal that includes nonconsensual priority-violating distributions of estate value. The Court further holds that there cannot even be a “rare case” exception where such structured dismissals would be appropriate. Opinion below.

Justice: Breyer

2017-03-22 – czyzewski v jevic holding corp

Author: Matt Lindblom

Sunshine Heifers, LLC v. Purdy

(W.D. Ky. Aug. 15, 2016)

The district court affirms the bankruptcy court’s decision that proceeds of the auction of the debtor’s cattle were properly payable to the bank, which held a first priority security interest in the debtor’s assets. While the Sixth Circuit had reversed the bankruptcy court’s prior decision finding the second creditor’s lease of the cattle to be a second priority lien (rather than a true lease), the bankruptcy court’s decision here was not clearly erroneous and was based on the evidence presented at the hearing to determine ownership of the cattle auctioned. The bankruptcy court found that all of the cattle subject to the leases had been sold prior to the auction. Opinion below.

Judge: McKinley

Attorneys for Plaintiff: Keller & Almassian, PLC, Michael D. Almassian, Nicholas S. Laue

Attorneys for Defendants: Kerrick Bachert PSC, Ashley D. Gerughty, Scott A. Bachert

2016-08-15 – sunshine heifers v purdy

Author: Matt Lindblom