Bankruptcy Preference News Includes Special Counsel Benjamin D. Feder’s Blog Post on Important Opinion Affecting Carve-Outs

Special counsel Benjamin Feder’s blog post, Delaware Bankruptcy Judge: A Carve-Out for Fees Is Not a Cap,” was included in the February Bankruptcy Preference News newsletter. Originally published in Kelley Drye’s Bankruptcy Law Insights blog, the post discusses a recently issued opinion in the Molycorp chapter 11 case.  The opinion held that a standard carve-out in a financing order for a creditors’ committee counsel and professionals’ fees will not limit the ability of such professionals to be paid in full under a confirmed plan of reorganization.  This ruling from Delaware Judge Christopher Sontchi could have a broad impact on chapter 11 practice in courts across the country. If followed by other courts, it will provide committee counsel with a bit more leverage in negotiations with secured lenders over carve-out provisions and payment of fees.

To read the full blog post, please click here.