2009 Chapter 11 Recent Developments (Part I)

Holding: Affirmed.

Reasoning: Browning has not alleged any damage to his land resulting from the light pulses and is therefore precluded from asserting a continuing intangible trespass. And, to the extent that Browning argues that the mere fact that the cables are still on his property, which is a continuing tangible trespass, Browning's claim is still discharged because, although the cable's presence on Browning's property could give rise to a continuing trespass claim - and Kansas law clearly allows a plaintiff to sue for past, present, and future damages inflicted by a tangible trespass - Browning's claim is based only upon the Debtor's initial (as opposed to some new illegal act) installation of the cable on the property and its subsequent failure to remove the cable. As for the unjust enrichment claim, Browning waived it by not arguing it before the bankruptcy court. But, in any event, it would be denied on the merits.

JELD-WEN, Inc. v. Mary Van Brunt, et. al. (In re Grossman's, Inc.), 389 B.R. 384 (Bankr. D. Del. 2008)

Facts: JELD-WEN, Inc. ("JW") is a successor-in-interest to Grossman's Inc., GRS Holding Company, Inc. and GRS Realty Company, Inc. (together, "Grossman's"), which are reorganized debtors. Grossman's chapter 11 plan of reorganization was confirmed in December 1997. In May 2007, Mary and Gordan Van Brunt sued JW in New York state court for injuries that Mary received from exposure to materials that contained asbestos. Mary alleged that she purchased these materials in 1977 from Grossman's when she remodeled her home. JW contends Mary's claim was discharged by the plan of reorganization.

Issues: Whether Mary's claim was discharged by the confirmation of Grossman's plan of reorganization.

Rules:

(1)

In the Third Circuit, a bankruptcy court must look to state law to determine when a claim or interest arises.

(2)

Under NY state law, asbestos personal injury claims do not arise until the injury manifests itself.

Holding: The plan of reorganization does not bar Mary's state court claim since her claim did not arise until after the case was confirmed.

Reasoning: Although a vast majority of courts hold that, to determine when a claim arises, the focus is on the time when the acts giving rise to such claim took place, this is not the rule in this case. Therefore, Mary's claim did not arise prepetition and is therefore not barred by the confirmation of Grossman's plan.

The Official Committee of Equity Security Holders of Finova Group, Inc. v. The Finova Group, Inc., et. al. (In re The Finova Group, Inc.), 393 B.R. 64 (D. Del. 2008)

Facts: The Debtors and the Equity Committee (the "Committee") appealed six orders that resulted in essentially two issues: (i) the appeal of the Bankruptcy Court's interpretation of the plan and the supporting documents that the Committee was not entitled to any distribution since the Debtors were and are forever insolvent and any payment is contrary to the plan's terms and (ii) the appeal of the Bankruptcy Court's decision to raise the cap previously imposed on fees and expenses that the Committee could incur.

Issues: Whether the Bankruptcy Court erred in its decisions.