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xii. In re American Capital Equipment, LLC, 688 F.3d 145 (3d Cir. 2012)
Issue and Holding: A bankruptcy court has the authority to determine at the disclosure statement stage that a Chapter 11 plan is unconfirmable. No confirmation hearing is necessary if it is obvious that the plan is patently unconfirmable, such that no dispute of material fact remains and any defects cannot be cured by creditor voting.
xiii. In re Paige, 685 F.3d 1160 (10th Cir. 2012)
Issue and Holding: Chapter 11 plan was proposed in good faith by third party purchaser of debtor's interest because there was no conflict of interest or unethical action by the third party purchaser or trustee.
xiv. In re All Land Investment, LLC, 468 B.R. 676 (Bankr. D. Del. 2012)
Issue: Whether the debtor's plan satisfied the cramdown requirements of section 1129(b).
Holding: The court denied confirmation of the debtor's plan and granted the creditor's request for relief from the stay. The court first addressed Citizens' motion for additional evidence. The court stated that "[i]n deciding whether to reopen a case, the court should consider (i) the burden, if any, on the parties and their witnesses, (ii) whether undue prejudice may result if the relief is not granted, and (iii) concerns about judicial economy." The court concluded that it was not appropriate to reopen the record to allow the additional appraisal evidence because "The record has been closed for quite some time and the estate should not be required to bear the costs of procuring additional expert testimony on valuation. More importantly, denying the Motion for Additional Evidence will not prejudice Citizens. Citizens' proposed new evidence would reinforce the record already made by providing cumulative evidence of the depressed value of the Collateral, and would not alter my decision in this matter." Next, the court addressed the confirmation requirements of § 1129, noting that before a debtor may use the cram down provisions to achieve confirmation, it must satisfy § 1129(a)(10) by garnering a vote in favor of the plan by at least one class of impaired claims. The court then noted that "'Artificial' impairment occurs when a plan imposes an insignificant or de minimis impairment on a class of claims to qualify those claims as impaired under § 1124." Courts are split over the issue of artificial impairment, with one line of cases concluding that the plain language of § 1129(a)(10) does not prevent a debtor from artificially impairing claims, and another line of cases concluding that allowing debtors to manipulate impairment of a class to satisfy § 1129(a)(10) "so distorts the meaning and purpose of [that section] that to permit it would reduce (a)(10) to a nullity." Here, Citizens argued that classes 1 and 3 (both of whom accepted the plan) were artificially impaired. Citizens also argued that the amount of its class 5 deficiency claim would control the vote of class 5, thus preventing the plan from satisfying the requirements of section 1129(a)(10). The court noted that "Class 1 consists of the pre-petition real estate tax claims and other secured claims of governmental units. The Class 1 claimants will retain their liens against the appropriate building lots and, as each lot is conveyed, the conveyance will be subject to the lien, unless the
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