COVID-19 Bankruptcy Relief Extension Act of 2021

The “COVID-19 Bankruptcy Relief Extension Act of 2021” was signed into law by President Biden on March 27, 2021.  Among other provisions, the debt limit under subchapter V of the Small Business Reorganization Act has been increased from $2,725,625 to $7.5 million for another year, until March 27, 2022. Subchapter V provides for a streamlined chapter 11 reorganization for qualified small businesses.  More information about Subchapter V is available here:

ILC publishes write-up by Danning Gill Summer Associate, Isabelle Cho on In re Love, 649 B.R. 556 (Bankr. E.D. Cal. 2023)

The following is a case update written by Isabelle Cho, Summer Associate at Danning, Gill, Israel & Krasnoff, LLP, analyzing a recent case of interest, In re Love, 649 B.R. 556, 560 (Bankr. E.D. Cal. 2023).

A bankruptcy court for the Eastern District of California, Hon. Christopher M. Klein, held that the student loan liability of a Chapter 7 debtor is discharged after satisfying, by the requisite preponderance of evidence standard, all three elements of the Brunner-Pena test for establishing undue hardship. The Court also analyzed the differing approaches of the Ninth and Second Circuits in interpreting the test. Importantly, the Court cited the Supreme Court case U.S. Bank Nat’l Ass’n v. Village at Lakeridge, 138 S. Ct. 960 (2018), to highlight that the division of roles between trial and appellate courts depend on the nature of the “mixed question” of law and fact. Applying the principles of Lakeridge, the Court determined that since evaluating undue hardship related to student loan debt involves a fact-based inquiry, appellate courts should apply a “clear error” standard instead of a de novo review. In re Love, 649 B.R. 556 (Bankr. E.D. Cal. 2023).

Here’s a link to the writeup on the CLA website:  click here.

To read the full published decision click here.

Aaron E. de Leest Recognized by the California Lawyers Association

Aaron de Leest, Attorney at LawThe California Lawyers Association has recognized Danning Gill’s Senior Counsel, Aaron E. de Leest, in the Member Spotlight for his achievements as a Business Law Section member.  Aaron is the current Co-Chair of the BLS Insolvency Law Committee and a past chair of the Publications Subcommittee for the ILC.  Congratulations to Aaron!

To read the full article, click here.

John N. Tedford, IV honored as the Century City Bar Association’s Corporate Bankruptcy Lawyer of the Year

Danning Gill congratulates our partner John N. Tedford, IV, on his recognition as the Century City Bar Association’s Corporate Bankruptcy Lawyer of the Year.  John and other award recipients were honored on November 10 at the CCBA’s 54th Annual Installation Banquet and Awards Ceremony.  Joining John and his wife Mary at the awards ceremony were the Hon. Alan M. Ahart, DG cofounder David Gill, present and former DG partners, associates, staff and friends.

 

 

Announcement of Confirmation of Jaguar Distribution Corp.’s Chapter 11 Plan of Liquidation

Danning, Gill, Israel & Krasnoff, LLP (“Danning Gill”), is proud to have represented Jaguar Distribution Corp. (“Jaguar”) in its chapter 11 case, in which Jaguar successfully sold substantially all of its assets and confirmed a chapter 11 plan of liquidation.  Jaguar’s plan went effective on July 15, 2022.

Jaguar distributed independent and international films and television programs to airlines and cruise ship companies.  As an early innovator in the field, Jaguar succeeded in bringing independent and international films to domestic and foreign airline audiences.  For a variety of reasons, including the increased availability of streaming and download services such as Netflix and Amazon, and the proliferation of “minimum guarantees” that distribution companies often pay for the right to distribute films and television shows, Jaguar experienced a significant decline in revenues.

Jaguar retained Danning Gill as insolvency counsel in early 2019.  Around the same time, Jaguar also retained James Wong of Armory Consulting Company as Chief Restructuring Officer.  Danning Gill and Mr. Wong worked together to explore Jaguar’s options, including reorganization or liquidation under chapter 11 of the Bankruptcy Code.

Danning Gill filed Jaguar’s chapter 11 petition on July 31, 2020.  A few days later, Danning Gill filed Jaguar’s motion for approval of sale procedures in connection with a proposed sale of substantially all of Jaguar’s assets to Ricochet Digital Media, LLC (“Ricochet”).  In October 2020, after an auction, the Bankruptcy Court approved Jaguar’s sale of substantially all of its assets to Ricochet for $30,000 plus a percentage of receivables and future revenues collected by Ricochet.  The sale closed on November 2, 2020.

In February 2022, Danning Gill filed Jaguar’s chapter 11 plan of liquidation.  Under the plan, which was confirmed in June 2022, Jaguar’s remaining assets were assigned to a liquidating trust to be administered for the benefit of Jaguar’s creditors.  Jaguar’s plan went effective on July 15, 2022.  A few weeks later, the trustee of the liquidating trust filed three lawsuits to try to generate additional funds to pay holders of allowed claims.

Jaguar’s case is In re Jaguar Distribution Corp.  It was filed in the U.S. Bankruptcy Court for the Central District of California, Case No. 1:20-bk-11358-MB, and assigned to the Honorable Martin Barash.  John Tedford and Aaron de Leest of Danning Gill served as Jaguar’s general bankruptcy counsel.  James Wong of Armory Consulting Co. served as Jaguar’s Chief Restructuring Officer.  The official committee of unsecured creditors was represented by Victor Sahn and Steve Burnell of SulmeyerKupetz, now of Greenspoon Marder, LLP.  The trustee of the liquidating trust established by Jaguar’s plan is Elissa Miller of Greenspoon Marder, LLP.

John N. Tedford, IV

We are proud of our partner and colleague John Tedford for being recognized by the Los Angeles Business Journal for this prestigious list.

Infowars Tries New Bankruptcy Section for Managing Litigation

Danning Gill Partner John N. Tedford, IV was quoted in The Deal in an article discussing the Subchapter V bankruptcy cases of three entities related to Alex Jones’ conspiracy-oriented website, Infowars.  Among other streamlined relief available as a result of the Subchapter V filings for small business debtors, unless the court orders otherwise, the creditors will not be able to form a creditors’ committee and the debtors won’t need to file a disclosure statement.

Stephanie Gleason
The Deal
April 20, 2022

Three entities associated with Infowars, the controversial, conspiracy-oriented website owned by Alex Jones, filed for Chapter 11 protection on Monday, April 18, using a new section of the code meant for small business — Subchapter V.

Infowars is the first company to attempt to use this new part of the code to manage tort liabilities.  Because the filing is under Subchapter V, there’s no guarantee that claimants — in this case families of victims of the 2012 Sandy Hook school shooting — will receive official committee representation.

In Subchapter V, “the default rule is that there is no committee,” John Tedford of Danning Gill Israel & Krasnoff LLP said.  He added, however, that a court can order one appointed.  There’s nothing to prohibit an official committee.

To read the entire article, click here.  Free trial subscription available.

L.A. Times Names Danning Gill Attorneys ‘Visionaries’
in Banking & Finance Issue

Eric Israel and John Tedford

Danning, Gill, Israel & Krasnoff partners Eric P. Israel, and John N. Tedford, IV have been recognized as visionaries in banking and finance by L.A. Times B2B Publishing.  According to the publication, the leaders profiled “were all nominated by their colleagues and peers and selected by our B2B Publishing stakeholders. Each of these senior-level executives has demonstrated successes and accomplishments during the last 24 months as well as leadership in their organizations while impacting change within their communities.”  We are honored to be recognized along with other accomplished professionals who serve the community. See the online version of the magazine here: https://www.latimes.com/b2b/finance.

Aaron E. de Leest Promoted to Senior Counsel

Aaron de Leest, Attorney at Law

Danning, Gill, Israel & Krasnoff, LLP, is pleased to announce that effective January 1, 2022, Aaron E. de Leest was elevated to Senior Counsel.  Congratulations to Aaron for his advancement and for all of his accomplishments, which accomplishments this year include prevailing in a published Ninth Circuit decision and confirming two chapter 11 plans.

To read more about Aaron, click here.