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Bankruptcy

Fallout in SDTX Bankruptcy Court

Have large corporations filed their Chapter 11 restructurings in Houston because the rules are favorable to debtors or because of Bankruptcy Judge David Jones’ expertise? Several bankruptcy lawyers fear it was the latter that made the Southern District of Texas the busiest jurisdiction over the past six years for complex business restructurings.

With Judge Jones’ resignation over the weekend amid a Fifth Circuit investigation, experts say that there is a danger of returning to the days when Texas lost billion-dollar restructurings to other jurisdictions.

Highly Respected Houston Bankruptcy Judge David Jones Resigns Amid Investigation

U.S. Bankruptcy Judge David Jones, one of the most prominent and busiest bankruptcy judges in the U.S., is expected to resign his position Monday over allegations of an undisclosed relationship with a former Jackson Walker bankruptcy lawyer who never appeared before him in a case, according to sources at the U.S. Court of Appeals for the Fifth Circuit and the U.S. District Court for the Southern District of Texas.

AI Chatbots Are Useless for Bankruptcy Lawyering

Although the developers label these apps as “experimental,” some commentators suggest that AI be put to work now in the real world of business and commerce. Some even contend that AI applications can do the job of lawyers, implicitly jeopardizing law practice as a career. Is it true?

Kane Russell Coleman Logan Team Comes Through for Unsecured Creditors in Icahn Co. Bankruptcy

Joe Coleman, John Kane, Brian Hail and a team of other lawyers from Kane Russell Coleman Logan recently secured a favorable outcome for a group of unsecured creditors in a bankruptcy proceeding for a Carl Icahn-owned company, Auto Plus. At the outset, it seemed the unsecured creditors stood to recoup none of their roughly $200 million in unsecured debt, but the legal team overcame three key challenges on its way to recovering more than $57 million: Auto Plus’ apparent administrative insolvency, a fast-tracked sale of assets already in motion and “the specter of the fact that Carl Icahn was the ultimate owner,” Coleman said. “Obviously, Mr. Icahn has an enormous reputation, he’s a very shrewd businessman.”

Gibson Dunn, Weil Lead Serta Simmons and Lenders to Bankruptcy Court Victory in SDTX

U.S. Bankruptcy Judge David Jones of Houston has approved the billion-dollar bankruptcy reorganization of mattress giant Serta Simmons, which also meant a monumental victory for a handful of investors in distressed debt and a huge legal defeat for some Wall Street leaders. The debt restructuring plan approved by Judge Jones cuts Georgia-based Serta Simmons’ secured debt from $1.9 billion to $315 million. In doing so, the judge coined a new term – position enhancement transaction or PET – that you need to learn.

The five-day trial was led for the Serta Simmons lenders by new Gibson Dunn partner Gregg Costa. This was Costa’s first trial since retiring from the U.S. Court of Appeals for the Fifth Circuit and his first-ever trial in bankruptcy court.

Sidley Lands Winstead Bankruptcy Partner Rakhee Patel

As corporate mergers, acquisitions and capital market practices have slowed in Texas the past few months, the focus on business bankruptcies and restructurings has returned. And the Texas offices of Sidley Austin have made one of the first big lateral moves. Rakhee Patel confirmed Tuesday that she has left Winstead after seven years as a shareholder and joined Sidley this week as a partner in the firm’s Dallas office. The timing could not be better for Sidley.

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