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TARTER KRINSKY & DROGIN LLP Attorneys for The Christian Brothers Institute, et al. Debtors and Debtors-in-Possession 1350 Broadway, 11th Floor New York, New York 10018 (212) 216-8000 Scott S. Markowitz, Esq. Marilyn Simon, Esq. UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ------------------------------------------------------------------- x In re: : : THE CHRISTIAN BROTHERS INSTITUTE, et al. : : Debtors. : ------------------------------------------------------------------- x

Chapter 11 Case No.: 11-22820 (RDD) (Jointly Administered)

MOTION FOR AN ORDER PURSUANT TO 1121(d) OF THE BANKRUPTCY CODE EXTENDING THE DEBTORS EXCLUSIVE PERIODS TO FILE A PLAN AND SOLICIT ACCEPTANCES THERETO TO: THE HONORABLE ROBERT D. DRAIN UNITED STATES BANKRUPTCY JUDGE The Christian Brothers Institute (CBI) and The Christian Brothers of Ireland, Inc. (CBOI), the above-captioned debtors and debtors-in-possession (together, the Debtors), respectfully represent as follows: RELIEF REQUESTED 1. Pursuant to 1121 of the Bankruptcy Code, a debtor has the exclusive right to file

a plan for one hundred twenty days after the case commences and has an additional period of sixty (60) days during which the plan must be accepted. The period for filing the plan in these cases expires on August 26, 2011. By this Motion, the Debtors seek the entry of an order

pursuant to 1121(d)(1) of the Bankruptcy Code granting an extension of the exclusive periods within which the Debtors may file a plan and solicit acceptances thereto for an additional period

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of one hundred and twenty (120) days, through and including December 24, 2011 and February 22, 2012, respectively. JURISDICTON, VENUE AND STATUTORY BASES FOR RELIEF 2. This Court has jurisdiction over this application pursuant to 28 U.S.C. 1334 and

the Standing Order of Referral of Cases to Bankruptcy Judges for the Southern District of New York, dated July 10, 1984 (Ward, acting C.J.). These are core proceedings pursuant to 28 U.S.C. 157(b). The statutory predicate for the relief requested herein is 1121(d) of the Bankruptcy Code. Venue of these proceeding and this application is proper pursuant to 28 U.S.C. 1408 and 1409. BACKGROUND 3. On April 28, 2011 (the Petition Dates), each of the above-captioned Debtors

commenced their respective Chapter 11 cases (individually, a Case and together, the Cases) by filing a voluntary petition for relief under Chapter 11 of Title 11, United States Code (the Code). Pursuant to 1107(a) and 1108 of the Code, the Debtors continue to operate as debtors-in-possession. No trustee has been appointed. 4. The Debtors cases were consolidated for administrative purposes only, by order

dated May 2, 2011. Thereafter, by order dated May 18, 2011, the Debtors were authorized to retain Tarter Krinsky & Drogin LLP as bankruptcy counsel. 5. On May 11, 2011, the United States Trustee appointed an Official Committee of

Unsecured Creditors (the Committee). The Committee has retained Pachulski Stang Ziehl & Jones LLP as its counsel. 6. CBI is a domestic not-for-profit 501(c)(3) corporation organized under 102(a)(5)

of the New York Not-for-Profit Corporation Law. CBI was formed in 1903 pursuant to Section

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57 of the then existing New York Membership Law. The Not-for-Profit Corporation Law replaced the Membership Law effective September 1, 1970. The purpose for which CBI was, and continues to be, formed was to establish, conduct and support Catholic elementary and secondary schools principally throughout New York State. As a not-for-profit corporation, the assets, and/or income are not distributable to, and do not inure to, the benefit of its directors or officers. CBI depends upon grants and donations to fund a portion of its operating expenses. 7. CBOI is a domestic not-for-profit 501(c)(3) corporation organized under the Not-

for-Profit Corporation Law of the State of Illinois. The purpose for which CBOI was, and continues to be, formed was to establish, conduct and support Catholic elementary and secondary schools principally throughout the State of Illinois, as well as other spiritual and temporal affairs of the former Brother Rice Province of the Congregation of Christian Brothers. As a not-forprofit corporation, the assets, and/or income are not distributable to, and do not inure to the benefit of its members, or officers. CBOI depends upon grants and donations to fund a portion of its operating expenses. 8. The cause for the filing of these Chapter 11 case has been extensively detailed in the

affidavit pursuant to Local Bankruptcy Rule 1007-2 filed with the original petitions and is referred to as if fully set forth herein. In short, the Debtors Chapter 11 cases were filed in an effort to resolve in one forum, an onslaught of litigation and claims asserted by alleged sexual abuse plaintiffs against the Debtors in several jurisdictions in North America. 9. By order dated June 28, 2011, CBI was authorized to retain Newmark &

Company Real Estate, Inc. d/b/a Newmark Knight Frank (Newmark) as its exclusive real estate broker with respect to the marketing and sale of real property located at 74 W. 124th Street, New York, NY 10027. This is the first of a number of properties that the Debtors are presently

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reviewing to determine which properties may be sold as part of their efforts to reorganize and propose a plan to creditors in these cases. 10. With the Committees consent, the Debtors have recently filed applications and

proposed orders to retain accountants who will be reviewing the Debtors finances and will give the Debtors advice with respect to (i) operations; (ii) the funding that will be required for continued operations; and (iii) evaluating the costs to modify or change their present structure. The Debtors believe that this analysis will take several months and must be completed before embarking on plan/reorganization negotiations. 11. A major issue in these cases will be the bar date for the filing of claims and

determining in which jurisdictions notice of the bar date should be advertised/published. It is critical that the Debtors make extensive efforts to notify potential abuse claimants of the importance and the need to file a proof of claim. In that regard, the Debtors, after consultation with the Committee, intend to retain a claims agent to assist in the marketing and distribution of the bar date notice. The terms of the bar date order are now being negotiated with the

Committee, and it will no doubt afford potential abuse victims a reasonable period of time to file proofs of claim. The Debtors and the Committee will also be negotiating the need for a future claims representative. The Debtors Chapter 11 cases are somewhat unique in that the Debtors, over a period of many decades, either operated or were significantly involved with several schools, orphanages, and other institutions across the United States and Canada. Noticing and advertising the bar date will be a significant undertaking in these Chapter 11 cases. Until the bar date has passed and the claims have been asserted and analyzed, neither the Debtors nor the Committee will be able to determine the aggregate of the claims or the amount that may be necessary to fund a plan in these cases.

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DISCUSSION 12. Section 1121 of the Bankruptcy Code provides, in pertinent part, as follows: (b) Except as otherwise provided in this section, only the debtor may file a plan until after 120 days after the date of the order for relief under this chapter. (c) Any party in interest, including the debtor, the trustee, a creditors committee, an equity security holders committee, a creditor, an equity security holder, or any indenture trustee, may file a plan if and only if (1) a trustee has been appointed under this chapter; (2) the debtor has not filed a plan before 120 days after the date of the order for relief under this chapter; or (3) the debtor has not filed a plan that has been accepted, before 180 days after the date of the order for relief under this chapter, by each class of claims or interests that is impaired under the plan. (d) (1) Subject to paragraph (2), on request of a party in interest made within the respective periods specified in subsections (b) and (c) of this section and after notice and a hearing, the court may for cause reduce or increase the 120-day period or the 180-day period referred to in this section. (2) (A) The 120-day period specified in paragraph (1) may not be extended beyond a date that is 18 months after the date of the order for relief under this chapter. (B) The 180-day period specified in paragraph 1 may not be extended beyond a date that is 20 months after the date of the order for relief under this chapter. 11 U.S.C. 1121 (b) - (d). 13. A courts decision to extend a debtors exclusive periods is based upon the facts

and circumstances of each particular case. See, e.g., First American Bank of New York v.

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Southwest Gloves and Safety Equip., Inc., 64 B.R. 963, 965 (D. Del. 1986); In re Texaco Inc., 76 B.R. 322, 326 (Bankr. S.D.N.Y. 1987). 14. Courts have identified certain factors as relevant in determining whether cause

exists to extend the exclusive periods. These factors include: (a) The size and complexity of the Chapter 11 case. See, e.g., In re McLean Indus., Inc., 87 B.R. 830, 834 (Bankr. S.D.N.Y); In re Texaco Inc., 76 B.R. 322. The degree of progress that has been achieved by the debtor in the Chapter 11 process and whether a viable plan of reorganization can be reasonably expected to be filed by the debtor in the foreseeable future. Jasik v. Conrad (In re Jasik), 727 F.2d 1379, 1382 (5th Cir. 1984). Whether the debtor has shown progress in attempting in good faith to formulate a viable plan of reorganization. See In re Public Serv. Co. of New Hampshire, 88 B.R. 521, 524 (Bankr. D.N.H. 1988).

(b)

(c)

15.

In applying these factors, it has been noted that the hallmark of . . . section

[1121(d)] is flexibility. In re Perkins, 71 B.R. 294, 297 (W.D. Tenn. 1987). Congress intended that a debtors exclusive periods be of adequate length for the debtor to formulate, negotiate, and draft a consensual plan and solicit acceptances thereof. As explained in the legislative history, section 1121(d) allows the flexibility in individual cases to extend the exclusivity periods to allow the debtor to reach an agreement. H.R. Rep. No. 595, 95th Cong., 1st Sess. 232 (1977); see In re Public Serv. Co. of New Hampshire, 88 B.R. at 534 (the legislative intent... [is] to promote maximum flexibility); see also In re Gibson & Cushman Dredging Corp., 101 B.R. 405,409 (Bankr. E.D.N.Y. 1989); In re McLean Indus. Inc., 87 B.R. at 833. 16. Where the initial exclusive periods prove to be inadequate, section 1121(d) of the

Bankruptcy Code permits the Court to extend a debtors exclusive periods so long as such extension does not extend beyond eighteen months for filing a plan or twenty months for soliciting acceptances to a plan. 11 U.S.C. 1121(d). This Motion is the Debtors first request

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for extensions of its exclusive periods, and the Debtors request is within the extension periods permitted by statute. 17. As detailed above, the initial months of these cases have been spent in reviewing

the Debtors real estate holdings and determining which real estate assets should be sold, making initial determinations with respect to the retention of professionals to guide the Debtors in these cases and help them to determine how to modify operations to effectively maximize the value of the Debtors assets for the benefit of all of the Debtors creditors, meeting with the Committee and setting up a procedure to respond to the Committees extensive document requests. 1 The Debtors have also been attempting to negotiate with various plaintiffs attorneys with respect to the liquidation of claims. 2 Given the short extension requested herein, there is no prejudice to other parties in interest. Finally, it will afford the Debtors and the Committee the time necessary to attempt to work towards a consensual plan which deals with all abuse claims in an orderly and fair fashion. 18. The Debtors submit that ample cause exists for the Court to grant the requested

extensions of the time. See In re McLean Indus., Inc., 87 B.R. at 834; see also In re Jasik, 727 F.2d at 1382 (extension of exclusivity period to be granted based upon degree of progress that has been achieved by the debtor in the Chapter 11 process); In re Public Serv. Co. of New Hampshire, 88 B.R. 521 at 524 (extension of exclusivity period to be granted based upon whether debtor has shown progress in attempting in good faith to formulate a viable plan).

The Committee has recently provided a proposed 2004 document request, which is, to say the least, extensive. For example, the Committee has requested documents dating back to the 1940s. The Debtors are attempting to cooperate in all respects with the Committee and to establish an orderly procedure to deal with the extensive document requests. 2 In that regard, the Debtors have removed various litigations and obtained orders transferring the litigations to this Court.

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NOTICE 19. Notice of this Motion is being given to the Committee and its counsel, the United

States Trustee and all parties having filed a notice of appearance or a request for notice in these cases. The Debtors respectfully submit that no further or other notice need be provided under the circumstances of these cases. NO PRIOR REQUEST 20. other court. WHEREFORE, the Debtors respectfully request that the Court enter an order, substantially in the form attached as Exhibit A hereto, granting the Motion, and granting the Debtors such other and further relief as the Court deems just and proper. Dated: New York, New York July 28, 2011 TARTER KRINSKY & DROGIN LLP Attorneys for The Christian Brothers Institute, et al. No prior application for the relief requested herein has been made to this or any

By:

/s/ Scott S. Markowitz Scott S. Markowitz Marilyn Simon 1350 Broadway, 11th Floor New York, New York 10018 (212) 216-8000

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EXHIBIT A

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UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ------------------------------------------------------------------- x In re: : : THE CHRISTIAN BROTHERS INSTITUTE, et al. : : Debtors. : ------------------------------------------------------------------- x

Chapter 11 Case No.: 11-22820 (RDD) (Jointly Administered)

ORDER PURSUANT TO 1121(d) OF THE BANKRUPTCY CODE EXTENDING THE DEBTORS EXCLUSIVE PERIODS TO FILE A PLAN AND SOLICIT ACCEPTANCES THERETO Upon the motion (the Motion) of The Christian Brothers Institute, et al., debtors and debtors-in-possession herein (the Debtors), for an order pursuant to 1121(d) of Title 11 of the United States Code (the Bankruptcy Code), extending the Debtors exclusive periods in which to file a plan and solicit acceptances thereto; and notice of the Motion having been given to the Office of the United States Trustee, Counsel to the Official Committee of Unsecured Creditors, and any party having filed a Notice of Appearance in these cases; and no other or further notice being necessary or required; and a hearing to consider the Motion having been held on August 24, 2011, and after due deliberation and sufficient cause appearing therefor, it is ORDERED, that the Motion is granted; and it is further ORDERED, that pursuant to Bankruptcy Code 1121(d), the Debtors exclusive period in which to file a plan is extended to and including December 24, 2011; and it is further ORDERED, that pursuant to Bankruptcy Code 1121(d), the Debtors exclusive period in which to solicit acceptances to the plan is extended to and including February 22, 2012; and it is further

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Exhibit A -

ORDERED, that the relief granted herein is without prejudice to the Debtors right to request further extensions of its exclusive periods, and the rights of other parties to oppose any further extensions. Dated: White Plains, New York August ___, 2011 THE HONORABLE ROBERT D. DRAIN UNITED STATES BANKRUPTCY JUDGE

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