Tampa    Fort Myers    Pensacola    Destin   

Specializing in insolvency and complex commercial matters since 1974

Firm succeeds at objection to lender’s claim, debtor awarded > $1 million in damages, successful sale of property – March 27, 2018

Following a successful confirmation and cramdown of the lender (which included a third party injunction), and a three-day trial on an objection to the lender’s claim, the Bankruptcy Court ruled in favor of the reorganized debtor and determined that the lender was precluded from recovering default interest, and that the debtor was entitled to recover the costs that it incurred as a result of the lender’s wrongful conduct.  The court awarded the reorganized debtor over $1 million in damages for breach of contract.  In re Kraz, LLC, 570 B.R. 389, 408 (Bankr. M.D. Fla. 2017); Lender is Liable to Borrower Due to Inflated Estoppel Letter and Due to Abuse of FDIC “Shared Loss” Agreement, But Tort Damages are Unavailable. [In re Kraz, LLC (Bankr. M.D. Fla.).] 2017-36 Comm. Fin. News. NL 69; Debtor Was Entitled to Costs of Bankruptcy, 08-16-17 West's Bankr. News 11.  The reorganized debtor’s property was successfully sold on March 27, 2018, resulting in a payoff of the lender’s reduced claim, discharge of the guarantees, and securing a distribution for equity interests.  Stephen Leslie, Mark Robens, and Michael Hooi led the firm’s representation of the reorganized debtor in the lender litigation, and Charles Postler and Michael Bachmann closed the sale.