assumption

Many preference defendants are not aware of the fact that if their pre-petition contract with the debtor is assumed or assigned in the course of the bankruptcy, then such assumption/assignment will generally serve as a bar to recovery for receipt of alleged preferential transfers.

Assumption of the lease is permissible even if the terms of the lease expressly prohibit assumption.  Section 365 of the Bankruptcy Code requires a debtor-tenant to meet certain criteria in order to “assume” a lease.  First, and most importantly, the tenant must cure any and all existing defaults, both monetary and non-monetary.  Second, the debtor-tenant must provide “adequate assurance” to the landlord that the debtor will be able to perform under the lease going forward.  The tenant’s obligation to cure defaults includes the payment of late charges or similar charges that arise under the

Bankruptcy courts (and lawyers) continue to mystify by their inability to tell the difference between types of intellectual property, confusing patents, copyrights and trademarks as if they are all just variations on the same theme. In the Virgin Offshore USA, Inc. case, the US District Court for the Eastern District of Louisiana had to deal with lawyers who had trouble telling the difference between copyrights and trade-secrets (or at least argued as if they did).

By Blanka Wolfe