Belk Inc., a national privately-owned department store chain, just completed a $450 million debt restructuring in less than 24 hours! U.S. Bankruptcy Judge Marvin Isgur confirmed the plan the morning of the First Day Hearing despite the U.S. Trustee’s concerns about adequate notice. The Debtors’ prepackaged plan became effective hours after it was confirmed by the Court.

Belk argued that the plan must be confirmed quickly because the company had no cash reserves and no committed DIP financing. The Court agreed with the need for a speedy plan to protect thousands of jobs and hundreds of stores from closing. The prepackaged restructuring plan was supported by nearly all the creditors. The U.S. Trustee objected to hasty plan confirmation because the interested parties would be rushed to evaluate, respond, or object to the plan.

Addressing the U.S. Trustee’s concern, the Court combined its plan approval with an order protecting the parties’ due process rights. The due process order preserves various parties’ rights to raise objections, opt out of releases, and dispute adequate assurance of future performance with respect to assumed leases, among other reservations. When seeking the fast approval, Belk emphasized that it took extreme efforts to notice 90,000 different parties. The Court noted that while there were no apparent due process violations, the due process order would protect “people who may have fell through the cracks.”

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Gabrielle Fromer

Gabrielle Fromer is a litigation associate in Herrick’s Restructuring & Finance Litigation Group, where she focuses her practice on bankruptcy and financial restructuring, complex commercial litigation, real estate disputes, and white collar criminal defense and investigations.

Gabrielle has done substantial pro bono work…

Gabrielle Fromer is a litigation associate in Herrick’s Restructuring & Finance Litigation Group, where she focuses her practice on bankruptcy and financial restructuring, complex commercial litigation, real estate disputes, and white collar criminal defense and investigations.

Gabrielle has done substantial pro bono work and helped to bring The Door’s Special Immigrant Juvenile Status Project to Herrick, assisting undocumented youth achieve this status in Family Court and later petition U.S. Customs and Immigration. Additionally, Gabrielle is an active contributor to the City Bar Justice Center’s COVID-19 Small Business Legal Clinic, advising small business owners on real estate and bankruptcy related issues.

Prior to joining Herrick, Gabrielle worked as an Assistant District Attorney in the Trial Division of the Bronx County District Attorney’s Office where she conducted misdemeanor trials and presented felony matters to the grand jury.

While attending law school, Gabrielle served as the Senior Symposium Editor of the Georgetown Journal of Gender and the Law, and worked as a student defense attorney through Georgetown’s Criminal Justice Clinic. As a law student, Gabrielle held internships with the New York County District Attorney’s Office and the Department of Justice. Additionally, Gabrielle summered as a judicial intern for U.S. Magistrate Judge Kevin Nathaniel Fox of the U.S. District Court for the Southern District of New York.