Newco Energy v. Energytec, Inc. (In the Matter of Energytec, Inc.)
- Citation:
- Newco Energy v. Energytec, Inc. (In the Matter of Energytec, Inc.), -- F.3d --, Case No. 12-41162 (5th Cir. Dec. 31, 2013)
- Tag(s):
-
- Ruling:
- Section 363(m) does not moot the appeal of an order determining the nature and extent of a non-bankrupt party's interest in a pipeline system when the 363 sale was approved subject to a later judicial determination of that interest. District court judgment vacated and case remanded.
- Procedural context:
- Appeal of a district court judgment affirming a bankruptcy court's decision that non-bankrupt Newco Energy's interest in a pipeline system, sold a year earlier through a Section 363 sale, was not a covenant running with the land.
- Facts:
- The Debtor moved to sell its pipeline system to Red Water pursuant to Section 363, free and clear of liens, claims, and encumbrances. Newco Energy objected on the basis that its right to a transportation fee and right to consent to any assignment were covenants that ran with the land and the sale could not be free of those interests. The bankruptcy court approved the sale and reserved Newco's objections for later determination. Sixteen months later, the bankruptcy court held that the transportation fee was not a covenant running with the land; it did not address the right to consent. The district court affirmed. The Fifth Circuit determined that Section 363(m) did not moot the appeal and that the transportation fee and the right to consent to assignment were covenants running with the land.
- Judge(s):
- Southwick, Dennis, Clement
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