Bankruptcy & Insolvency

Overview

In the United States, the term “bankruptcy” specifically means a case under Title 11 of the United States Code. Insolvency does not always result in a bankruptcy filing, because sometimes bankruptcy is not legally available or is not the best solution for our clients. But when choice or circumstance brings our clients to Bankruptcy Court, the Derbes Law Firm advises clients and protects their rights in this area of federal law.

Defining Strengths

The firm regularly represents creditors, debtors, trustees, and committees. This diverse perspective gives the firm a balanced perspective on the entire bankruptcy process. The firm handles both commercial (chapter 7 and chapter 11) and personal (chapters 7, 11 and chapter 13) bankruptcy. Many of the individual debtors we represent are business owners with significant contingent liability to lenders or vendors.

Utilizing our transactional experience to negotiate workout agreements and forbearance agreements, the firm’s attorneys help debtors avoid bankruptcy where appropriate, whether the problem arises from a difficulty in cash flow, income, or an inadequate amount of assets relative to debt (i.e., a balance sheet problem). The best solution for creditors and debtors alike is often found in restructuring, refinancing, or settlement either in or out of Bankruptcy Court. Within Bankruptcy Court we negotiate bankruptcy plans, whether Chapter 11, Chapter 13, or the new Subchapter V of Chapter 11 for small businesses. We also advise persons regarding the relationship of taxation and bankruptcy.

Our extensive litigation experience allows us to comfortably appear in Bankruptcy Court, Federal, and Louisiana state courts on behalf of creditors, debtors, committees, and trustees. We represent creditors and trustees in our bankruptcy litigation practice. Such cases include litigating avoidance actions such as preferences or fraudulent conveyances, objections to discharge and dischargeability, and proof of claim objections. Our Federal District Court practice includes matters where “the reference is withdrawn” to Federal District Court as well as Bankruptcy appeals. Our Louisiana state court litigation practice includes representation of owners, creditors, liquidators, or receivers of the companies in Louisiana liquidations.

Experience

The Derbes Law Firm has one of the largest concentrations of attorneys who regularly practice bankruptcy in the State of Louisiana. Collectively, those seven attorneys have over a century and a half of bankruptcy experience to draw upon. These attorneys have worked with business and individual clients through multiple causes of downturns in the local economy – the Covid Pandemic, the BP Oil Spill, the Great Recession, the Katrina Levee breaches, as well as fluctuations in the price of oil and gas. We have also helped many individuals and families through the more typical causes of bankruptcy – costly medical bills, job loss, divorce, excess consumer debt, as well as failed businesses. Many of the individual debtors we have represented are business owners with significant contingent liability, including tax liability.

The Derbes Law Firm has obtained the following results for creditors, creditor committees, debtors, and trustees in the following well-known cases:

Maintained client creditor as operator of a frac sand processing plant during involuntary bankruptcy. Also, worked with lenders, chapter 11 Trustee, and creditor’s committee for a successful chapter 11 plan confirmation. In re Alliance Consulting Group, LLC, U.S. Bankruptcy Court, S. District of Mississippi (Gulfport Division), 13-51937;
Obtained confirmed chapter 11 plan reorganizing a golf course during the Great Recession. Ormond Country Club, U.S. Bankruptcy Court, Eastern District of Louisiana, 10‐10807;
As counsel for the Official Unsecured Creditors’ Committee Counsel, successfully negotiated a second mortgage against the Creole Queen to secure $0.30 on the dollar for unsecured creditors. The firm acted as distribution agent for the payments to the unsecured creditors. New Orleans Paddlewheels, Inc., U.S. Bankruptcy Court, Eastern District of Louisiana, 06‐10413;
As chapter 7 Trustee’s counsel, obtained millions of dollars of distribution to creditors by bringing numerous successful adversary proceedings. Schwegmann Giant Super Markets, U.S. Bankruptcy Court, Eastern District of Louisiana, 00‐15876;
As counsel for the elected chapter 7 Trustee, represented him in numerous adversaries and contested matters, including 147 preference causes of action, resulting in over $7 million in distributions to creditors. Service Marine Industries, Inc., U.S. Bankruptcy Court, Eastern District of Louisiana, 98‐15377;
As counsel for approximately 169 creditors, our firm filed an involuntary petition then worked with the U.S. Trustee in Oregon to substantively consolidate over 400 partnerships. This case involved four national Ponzi schemes and over one‐half billion dollars in claims. The principal was ultimately sentenced to 19 years in federal prison. J. Hoyt & Sons Management Co, Ltd, and W.J. Hoyt Sons Ranches, MLP., U.S. Bankruptcy Court, D. Oregon, 97‐31374 (Lead Case).

The Derbes Law Firm’s results in bankruptcy cases have included the following:

Multiple instances of confirming chapter 11 plan to reorganize LLCs owning rental units;
Multiple instances of using chapter 7 to discharge substantial individual income tax liabilities;
Regularly uses chapter 7 to free individual business owner client of extensive guaranty liabilities arising from failed business;
Used chapter 13 to aid divorcing spouse by compelling liquidation of house in order to pay all community debt;
Obtained reasonable settlement of franchise and guaranty disputes from franchisor after filing chapter 11; and
Obtained for creditor client a bankruptcy judgment of no discharge and no dischargeability of $7 million state court judgment.