A few quick observationos from the opinion:
The Court concludes that the Stern v. Marshall decision does
not support the TPS Consortium’s contention that the Court lacks
jurisdiction over the GSA or confirmation of the Modified Plan
for several reasons. (page 8)
For all the above reasons, the Court concludes that it has
jurisdiction to decide confirmation of the Modified Plan which
incorporates the GSA resolving the disputed claims to putative
property of the Debtors’ estate. (page 16)
Unlike the Court in DeMarco, the Court declines to exercise
its discretion under Rule 8005 not to consider the Modified Plan
simply because it might render moot the TPS Consortium’s appeal
of the decision in the TPS Adversary. The TPS Consortium could
have avoided this by seeking a stay pending appeal. To do as the
TPS Consortium requests would preclude the Court from dealing
with confirmation of any plan of reorganization that implicates
the TPS and possibly stall these bankruptcy cases indefinitely. (page 22)
The Court believes that the
Liquidating Trustee must be removable at the discretion of a
majority of the Trust Advisory Board. In addition, the
composition of the Trust Advisory Board must reflect the
constituents who hold Liquidating Trust Interests. When
creditors are paid in full, their Liquidating Trust Interests
will be canceled and preferred shareholders will be issued
Liquidating Trust Interests. (Tr. 7/13/2011 at 98; D 255 at §§
6.3, 7.3, 16.3, 18.3, 19.3, 20.3, 22.1, 22.2, 23.1 & 24.1.)
Consequently, the Trust must provide that when creditors lost
their Liquidating Trust Interests, the creditors’ representatives
on the Board will be replaced by representatives selected by
equity. (page 25)
The Court disagrees. Despite the recent ANICO decision, the
likelihood of success on the Debtors’ business tort claims, the
delay and cost of pursuing them, their complexity, and the
possible difficulties of collecting all militate in favor of
approval of the GSA. (PAGE 29)
Based on all of the above, the Court concludes that the
value of the Reorganized Debtor and its NOLs is $210 million.
(PAGE 62)
Based on the record developed, the Court finds that the
conduct of the Settlement Noteholders does not mean that the Plan
was proposed in bad faith. Despite the allegations of insider
trading by the Settlement Noteholders, the Court is unconvinced
that their actions had a negative impact on the Plan or tainted
the GSA.
Rather, the actions of the Settlement Noteholders appear to
have helped increase the Debtors’ estates. (PAGE 71)
Now that all issues have been presented to the Court, the
Court concludes that the better view is that the federal judgment
rate is the appropriate rate to be applied under section
To the extent I suggested in Coram that the federal 35
judgment rate was not required by section 726(a)(5), I was wrong.
315 B.R. at 346 (applying federal judgment rate nonetheless
because of the equities of the case).
726(a)(5), rather than the contract rate. The Court’s 35
conclusion is supported by many factors.(PAGE 77)
The Court agrees with the Plan Supporters on this point.
The statute expressly provides that such interest shall be paid
“at the legal rate from the date of the filing of the petition”
suggesting that it is the interest rate effective on the petition
date that should be used. (PAGE 88)
The Court finds that the Equity Committee has made
sufficient allegations and presented enough evidence to state a
colorable claim that the Settlement Noteholders acted recklessly
in their use of material nonpublic information. (PAGE 135)
Based on all these, I find it difficult to believe anything other than this is still going to take quite a while to end and most of us are confused as to what it means.
