UMB Bank, National Association v. Berry Petroleum (In re Linn Energy)

Case Type:
Case Status:
18=40443 (5th Circuit, Jun 14,2019) Published
Secured creditor group was not entitled, under the confirmed Plan of Reorganization (which it had accepted), to post-petition default interest (even though the group was fully secured and its debt instruments provided for default interest). The ruling was based upon an interpretation of allegedly conflicting provisions of the confirmed Plan and not upon any other analysis.
Procedural context:
Appeal from District Court which had affirmed the Bankruptcy Court's ruling that denied post-petition default interest.
Provisions of the confirmed Plan of Reorganization were allegedly in conflict as to whether a group of fully secured creditors was entitled to post-petition default interest. The group's debt instruments provided for default interest. The group was full secured and it had accepted the Plan. The Fifth Circuit (like the courts below) interpreted the allegedly conflicting Plan provisions against the group seeking an award of post-petition interest.
Stewart, Southwick and Engelhardt

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