Robins Kaplan LLP (JD Supra Puerto Rico)
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Expanding the Unconditional Right to Intervene: A Win for UCC’s
Expanding a split among circuit courts, the First Circuit recently set precedent promoting the unconditional right of creditors’ committees to participate in all aspects of bankruptcy cases. Reversing a lower court, in In Re: The Financial Oversight and Management Board for Puerto Rico, the First Circuit held that 11 U.S.C. 1109 (b) gives creditors’ committees an unconditional right to intervene
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Balancing the Equities: Default Interest Rate Adjusted as Bankruptcy Court Weighs in on Critical Issue
Can a bankruptcy court apply its equitable powers to adjust the default rate for post-petition interest owed to over-secured creditors? The Bankruptcy Court for the District of Puerto Rico recently held that the Bankruptcy Code allows for a “balancing of the equities” in determining whether to apply a contractual default rate or a contractual non-default rate for interest accruing after the...