David J. Coyle Panelist at Ohio Bankruptcy Bench Bar Conference

TOLEDO, OH – Shumaker, Loop & Kendrick, LLP is pleased to announce that David J. Coyle, partner in the Toledo office, was a panelist at the 2017 Northern District of Ohio Bankruptcy Bench Bar Conference on October 20, 2017 in Independence, Ohio.  Attendees of the Conference discuss various issues unique to the bankruptcy bench and bar and address consumer and commercial practice matters.

Dave was a member of a three person panel who presented on the United States Supreme Court’s decision earlier this year in a case captioned Czyzewski v. Jevic Holding Corp., 137 S. Ct. 973 (2017).  It is a decision that could have wide ranging implications in Chapter 11 bankruptcy cases.

In the Jevic decision, the Supreme Court held that former employees of the debtor company had Article III standing to challenge the decision of the bankruptcy court and that a bankruptcy court may not approve a “structured dismissal” of a Chapter 11 bankruptcy case that provides for distributions to creditors that do not follow the Bankruptcy Code’s ordinary priority rules without the affected creditors’ consent.

The Supreme Court noted that “structured dismissals” are not expressly mentioned in the Bankruptcy Code but they appear to be increasingly common.  A structured dismissal is, as defined by the American Bankruptcy Institute, a “hybrid dismissal and confirmation order … that … typically dismisses the case while, among other things, approving certain distributions to creditors, granting certain third-party releases, enjoining certain conduct by creditors, and not necessarily vacating orders or unwinding transactions undertaken during the case”.

The Supreme Court noted that Chapter 11 of the Bankruptcy Code foresees three possible outcomes in a Chapter 11 proceeding.  The first possible outcome is a bankruptcy-court-confirmed plan; the second is a conversion of the case to a Chapter 7 proceeding; and the third outcome is dismissal of the Chapter 11 case.  A dismissal of a Chapter 11 case “typically ‘revests the property of the estate in the entity in which such property was vested immediately before the commencement of the case’ - in other words, it aims to return to the prepetition financial status quo’”.

A structured dismissal is a combination of the first and third possible outcomes and, in Jevic, the Supreme Court noted that it “expressed no view about the legality of structured dismissals in general”.

In Jevic, the Supreme Court found in the case before it that, in the structured dismissal issued by the Jevic Bankruptcy Court, the Bankruptcy Court had approved a structured dismissal that provided for a distribution of the Debtors’ assets that did not follow the Bankruptcy Code’s ordinary priority rules for payments to creditors, over the objection of the creditors that were skipped over.  The Supreme Court reversed the decision of the Bankruptcy Court because “Courts cannot deviate from the strictures of the [Bankruptcy] Code, even in ‘rare cases’”.

Dave is a member of Shumaker’s bankruptcy and litigation practice groups.  He has extensive experience in bankruptcy, commercial litigation, commercial foreclosures, replevin actions, condemnation proceedings and business torts.   

Dave is a member of the Toledo and Ohio State Bar Associations and the American Bankruptcy Institute.  Dave is a long time member of the Board of Trustees of the Toledo Legal Aid Society and a past member of the Boards of Trustees of Advocates for Basic Legal Equality, Inc. and Legal Aid of Western Ohio.  He has also been a long-time volunteer with the Toledo Bar Association’s Pro Bono Legal Services Program.  Dave is a past recipient of Legal Aid of Western Ohio’s “Distinguished Service Award” and has been selected for inclusion in The Best Lawyers in America®.  

Dave received his J.D. from The Ohio State University Moritz College of Law and his B.S. from Ball State University. 

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Founded in 1925, Shumaker, Loop & Kendrick, LLP is a full-service law firm with more than 260 lawyers and five offices in Toledo and Columbus, Ohio; Tampa and Sarasota, Florida; and Charlotte, North Carolina.  Shumaker is a premier provider of quality legal services.  Whether it's commitment to clients or work in the community, involvement lies at the core of all of Shumaker’s initiatives.