- Case No. 14-10768 (5th Cir. April 23, 2015)
- Appellant was not entitled to maintain its Section 1111(b) election because the confirmed plan provided for a sale of the appellant's collateral and appellant failed to provide notice of its intent to credit bid on the collateral.
- Procedural context:
- Appellant, a creditor in the Chapter 11 proceeding, filed an election under Section 1111(b) to have its claim treated as fully secured. The Chapter 11 plan proponent objected, arguing that Section 1111(b) does not allow election if the collateral is "to be sold under the plan". The proposed plan was confirmed without objection from the appellant, and the bankruptcy court subsequently disallowed appellant's 1111(b) election. The District Court affirmed.
- Appellant was one of the petitioning creditors that commenced an involuntary Chapter 7 case against the Debtor. The case was subsequently converted to Chapter 11 and a party-in-interest filed a proposed Plan of Reorganization that provided for the sale of the Debtor's mineral interests, including part of the appellant's collateral. The confirmed plan permitted the sale of the mineral interests to the plan proponent free and clear of liens pursuant to Section 363; however, appellant claimed that the plan failed to recognize or provide for its right to credit bid on the collateral. Appellant did not assert a credit bid prior to confirmation, and provided no evidence that the value of the collateral was higher than that of the asserted lien.
- REAVLEY, JONES, and ELROD, Circuit Judges.
Victor Kearney v. Unsecured Creditors Committee
Summarizing by Bradley Pearce
3217 in the system
1 Being Processed