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i. Wells Fargo Bank National Association v. Texas Grand Prairie Hotel Realty, L.L.C. (In re Texas Grand Prairie Hotel Realty, L.L.C.), 710 F.3d 324 (5th Cir. 2013)
Issue: Whether secured creditor's appeal of a confirmed plan's cramdown interest rate was equitably moot.
Holding: The Fifth Circuit held that a secured creditor's appeal of a confirmed plan's cramdown interest rate was not equitably moot because partial relief could be granted, either by a higher interest rate or a small money judgment, which would not disturb the plan. The court described the three factors for equitable mootness as "(i) the plan of reorganization has not been stayed, (ii) the plan has been 'substantially consummated,' and (iii) the relief requested by the appellant would 'affect either the rights of parties not before the court or the success of the plan.'" Though the first two factors for equitable mootness were met because the plan was not stayed and nearly $8 million in distributions had been made under the plan, the court found it could award partial relief in a higher interest rate or small money judgment. Additionally, the debtor failed to show that such partial relief would unduly burden parties not before the court.
ii. In re Stephens, 704 F.3d 1279 (10th Cir. 2013)
Issue: Whether the direct appeal on the confirmation of an individual Chapter 11 plan was moot.
Holding: On direct appeal, the Tenth Circuit reversed the bankruptcy court's confirmation of a plan. The Court held that the appeal was not moot eventhough the plan had been substantially consummated because the debtor failed to prove that reversal and conversion to Chapter 7 would adversely affect the non-party creditors in any significant way.
iii. In re Philadelphia Newspapers, LLC, 690 F.3d 161 (3d Cir. 2012)
Issue and Holding: Appeal of bankruptcy court's denial of request for allowance of administrative expense claims was not equitably moot. While the finality of the bankruptcy court decision necessarily could be disturbed, a holding in favor of appellant would not upset the Chapter 11 plan or the rights of other parties.
iv. Shah v. Abitibibowater Inc. (In re Abitibibowater Inc.), 490 B.R. 170 (D. Del. 2013)
Issue: Whether a debtor's shareholder's appeal from an unstayed order confirming the debtor's plan should be dismissed as equitably moot.
©2014 William L. Norton III
