Bankruptcy

Not so fast (says GM)

By Stephen Lubben

The debtors have filed an objection to the motions to expedite the appeal to the 2d Circuit. In short, the debtors argue

The issues that the Movants wish to raise on appeal do not rise to matters of public importance.  Rather, the interests that they wish to champion are their own (in the Individual Accident Litigants? words, ?[c]ertifying the . . . appeal will materially advance the . . . determination of their rights against the Purchaser?):  that is, the Movants want certification as to claims of a handful of individual tort litigants who assert, but have not yet even prevailed on, alleged prepetition claims that can and will be addressed in the administration of the chapter 11 cases.

The debtors also argue against a stay pending appeal, and argue that if the court does grant such a stay it should be conditioned on the posting of a substantial bond.  The bankruptcy court hearing on these motions is scheduled to begin right now.

I do think the debtors are right to highlight the extent to which the appellants seem to be pursuing an appeal for the sake of legal clarity -- the federal courts, unlike some state courts (e.g., New Hampshire), have strong rules against issuing "advisory opinions" that clarify the law without influencing the outcome of the pending case.

Full post as published by Credit Slips on July 07, 2009 (boomark / email).