732-922-1000

Bankruptcy

BANKRUPTCY DEPARTMENT UPDATE – FEBRUARY 2023

Ansell Grimm February 1, 2023

Led by Department Chair James G. Aaron, in coordination with partners Joshua S. Bauchner and Anthony J. D’Artiglio, Ansell’s attorneys are well versed in the intricacies of bankruptcy practice. Our bankruptcy attorneys are here to offer the knowledge and advice about the benefits and detriments of the different types of bankruptcy; Chapter 11, Chapter 13, and Chapter 7 proceedings, all of which should be considered prior to any individual or business filing for bankruptcy. Before filing, our attorneys will provide a complete analysis of our client’s assets and guide them through the establishment of an asset protection plan.

The Firm represents numerous national and state banking institutions, Fortune 500 companies, and many local corporate entities in restructuring corporate debt, and represents both creditors and debtors in all proceedings.

In particular, the Firm represents commercial landlords whose tenants file for bankruptcy. The landlord becomes an estate creditor and has numerous, defined rights under the U.S. Bankruptcy Code. As set forth below, Ansell recently experienced significant success on behalf of our landlord/creditor clients protecting their interest in realty and securing against abuse of the bankruptcy process by recalcitrant debtors.

The firm also handles state court insolvency matters, an alternative to federal bankruptcy, known as an assignment for the benefit of creditors (“ABC”). Similar to a Chapter 7 liquidation proceeding, an ABC permits a debtor to assign its claims to an assignee — here, an attorney with the Firm appointed by the Court — to pursue preferential and fraudulent claims under state law.

By example, here are some of the Firm’s recent successes in this practice area:

Recovery for Landlord in Debtor’s Attempt to Escape Obligations 

Partner Anthony J. D’Artiglio and Shareholder and department co-chair Joshua S. Bauchner recently secured a favorable decision from the Bankruptcy Court in the Southern District of New York in the Fairway Group Holdings Corp. matter. Our client, Debtor’s property owner, filed a multi-million-dollar cure objection asserting that Debtor had failed to repair and maintain the property in accord with its lease obligations, and thus needed to make the necessary repairs or pay for the repairs as part of the lease assumption and assignment. Debtor sought to dismiss the cure objection, arguing that the new tenant was responsible for all pre-assignment defects as part of the lease’s ongoing repair and maintenance obligations and that, because property owner did not issue a default notice pre-petition pursuant to a lease provision, property owner could not claim that a “default” existed requiring cure pursuant to the Bankruptcy Code. The Court resoundingly rejected Debtor’s arguments, holding that (i) Debtor is responsible for all necessary pre-assignment repairs pursuant to the lease because the buyer took the property “free and clear” of any and all defaults by Debtor at the time of the assignment, and (ii) landlord was not required to formally notice a “default” under the lease to seek the cost of repairs from Debtor for any pre-assignment condition in need of repair particular where, as here, Debtor was on notice upon the filing of the cure objection.  As a result of this favorable ruling, our client can recover millions of dollars in repair costs.

Conversion to a Chapter 7 and Vacature of Extension of Automatic Stay

The Firm successfully compelled conversion of a meritless Chapter 11 to a Chapter 7 proceeding and convinced the Court to vacate an extension of the automatic stay to the principal’s of the Debtor company. Debtor filed a Chapter 11 petition in the District of New Jersey just before it and its principals were scheduled to face trial in the Western District of Missouri on multi-million dollar fraudulent scheme related to the sale of a business. Led by Joshua S Bauchner and Anthony J. D’Artiglio, the firm successfully convinced the Court to vacate an extension of the automatic stay to the principals of Debtor who sought to utilize the Bankruptcy to shield themselves from liability. Furthermore, we vigorously opposed confirmation of a meritless Plan of Reorganization, culminating in Debtor voluntarily converting its Chapter 11 reorganization to a Chapter 7 liquidation requiring the appointment of a Trustee to pursue our client’s and other creditors’ interests. As a result, the adversary complaint and related Bankruptcy matters were dismissed in New Jersey permitting the action to proceed to trial in Missouri.

Protection for Landlord from Tenant Bankruptcy  

Partner Anthony J. D’Artiglio and Shareholder Joshua S. Bauchner secured an extremely favorable settlement on behalf of a property owner whose tenant filed for bankruptcy after failing to make any rent payments over a prolonged period. Following our filing of an application to compel lease rejection or for relief from the automatic stay, the tenant agreed to pay outstanding rent and additional rent, our client’s attorneys’ fees and costs, and to increase the security deposit as a condition of assumption of the lease, ensuring the property owner was not harmed by the tenant’s bankruptcy filing.

Relief for Landlord from Automatic Bankruptcy Stay 

Partner Anthony J. D’Artiglio and Shareholder Joshua S. Bauchner successfully secured relief from the automatic bankruptcy stay for a landlord whose tenant had sublet the property without authorization, failed to pay substantial rent, and additional rent due and owing. We successfully convinced the Court to order the tenant to make post-petition payments on an ongoing basis and to lift the automatic stay to permit the property owner to pursue the tenant for damages and eviction in State Court while the bankruptcy remained pending.

For additional information concerning Ansell’s Bankruptcy Department, please contact us at (973) 247-9000, or email James G. Aaron (jga@ansellgrimm.com), Joshua S. Bauchner (jb@ansellgrimm.com), or Anthony J. D’Artiglio (ajd@ansellgrimm.com).

 

About Ansell Grimm & Aaron, PC
Ansell Grimm & Aaron, PC was founded in 1929 and has a long history of delivering for clients who come to us to resolve legal matters that are often urgent, stressful, and of great importance. A general practice law firm, Ansell Grimm & Aaron is powered by experienced attorneys who understand that the best outcome is the one that serves the needs of each client.

The above is for informational purposes only and does not constitute legal advice. Transmission of the materials and information contained herein is not intended to create, and receipt thereof does not constitute the formation of, an attorney-client relationship. Attorney advertising.

 

Ansell Grimm & Aaron 2021 Litigation Roundup

Ansell Grimm January 20, 2022

As the world continues to struggle with the coronavirus pandemic, and millions of small and mid-sized businesses continue to be confronted with unprecedented challenges, the attorneys in Ansell Grimm & Aaron’s Litigation Department assisted the Firm’s clients in protecting their businesses and livelihoods. Led by co-chairs Lawrence Shapiro and Joshua Bauchner, and assisted by attorneys Barry Capp, Anthony D’Artiglio, Stefan Erwin, Rahool Patel, Seth Rosenstein, and Ashley Whitney, the Department is pleased to share its numerous successes.

 

Bankruptcy Litigation & Debtor/Creditor Matters

Ansell Grimm & Aaron successfully compelled conversion of a meritless Chapter 11 Bankruptcy to a Chapter 7 and convinced the Court to vacate an extension of the automatic stay to principal’s of the Debtor company. Debtor filed a Chapter 11 petition in the District of New Jersey just before it and its principals were scheduled to face trial in the Western District of Missouri on multi-million dollar fraudulent scheme related to the sale of a business. Led by Joshua S Bauchner and Anthony J. D’Artiglio, the firm successfully convinced the Court to vacate an extension of the automatic stay to the principals of Debtor who sought to utilize the Bankruptcy to shield themselves from liability. Furthermore, we vigorously opposed confirmation of a meritless Plan of Reorganization, culminating in Debtor voluntarily converting its Chapter 11 reorganization to a Chapter 7 liquidation requiring the appointment of a Trustee to pursue our client’s and other creditors’ interests. As a result, the adversary complaint and related Bankruptcy matters were dismissed in New Jersey permitting the action to proceed to trial in Missouri.

 

Breach of Contract Litigation

The Ansell Grimm & Aaron team continued its efforts to recover sums owed to its clients in connection with finance agreements and contracts for the provision of certain services. We doggedly pursued our clients’ counterparties who absconded with loaned funds and enjoyed the benefit of services rendered, resulting in substantial recoveries and settlements for our dedicated and hard-working clients. By way of example, in one action brought on behalf of a trucking insurance agency that guaranteed payments for its client, the insured failed to make millions of dollars in payments under its finance agreement and created a new entity to hide its property and assets from collection. We aggressively tracked down the fraudulently transferred assets, brought the insured’s owner and his new entity into the action, and secured a favorable settlement prior to trial.

 

Partnership Dispute Litigation

The firm successfully obtained temporary restraints enacted to avoid continued irreparable harm to our client in a derivative action asserting claims against our client’s former business partners for, inter alia, unfair competition, fraud, and breach of fiduciary duty, based on their acts of engaging in direct competition with their shared business and allowing their family members to use the company’s proprietary information to siphon clients and profits from the business. The temporary restraints prevented all competition with our client’s business and provided the leverage necessary to negotiate a dissolution of the business which allowed our client to extricate himself and pursue independent ventures.

 

Real Estate Litigation

The firm works closely with real estate professionals across the region to protect their rights and put practices in place to minimize potential liability. In an action filed earlier this year on behalf of a Hudson County-based real estate broker, the Firm sued a national real estate developer after the failure to pay a referral fee offered under the developer’s agreement with local brokers. These efforts resulted in our client recovering a substantial portion of the referral fee owed to it, and the same broker subsequently engaged our team to revise their agreements used with clients — and to speak with the broker’s team of agents about mitigating risk and general best practices.

 

FINRA Matters

In addition to serving as a Financial Industry Resolution Authority (FINRA) Dispute Resolution Services arbitrator, associate Seth Rosenstein also practices before FINRA arbitration panels. In an arbitration filed against a national broker-dealer, the Firm sought an award requiring removal of incorrect and misleading information set forth on the broker-dealer’s Form U5 issued for our client, and for the expungement and removal of the information from FINRA’s Central Registration Depository and BrokerCheck system. Our efforts resulted in the broker-dealer issuing an amended Form U5 that removed the incorrect and misleading information, correcting an injustice that falsely besmirched our client’s reputation.

 

Police Benevolent Association Matters

Earlier this year, Attorney Ashley V. Whitney filed an appeal with the New Jersey Supreme Court challenging an opinion from the Appellate Division which upheld the termination of a police officer with no prior discipline for alleged violations of the Criminal Justice Information System through his use of full-disclosure vehicle registration searches despite the police department’s failure to identify a single full-disclosure search conducted without justification. The Appellate Division’s decision may have a lasting impact upon the law enforcement community as the performance of searches by police has not been significantly addressed by New Jersey Courts since the decision in State v. Donis, 157 N.J. 44 (1998). The decision is especially pertinent to the issues facing police as it comes on the heels of the Supreme Court’s decision in the matter of In re AG Law Enf’t Directive Nos. 2020-5 & 2020-6, 2021 N.J. LEXIS 486 (June 7, 2021), which upheld the New Jersey Attorney General’s Directives requiring the release of the names of police officers who receive major discipline.

Ms. Whitney continued her prior practice of the representation of police officers as a member of the PBA Legal Protection Plan at the Firm’s Woodland Park office, which included the defense of a high-ranking correctional police officer served with inflated disciplinary charges seeking termination. Following a departmental hearing and the presentation of favorable witness testimony, the employer decreased the proposed penalty from termination to suspension and we are awaiting a final decision.

 

Class Action Litigation

Ansell Grimm & Aaron successfully obtained dismissal of a nationwide class action in the District of New Jersey for lack of subject matter jurisdiction. Plaintiff brought claims against related to beauty products against the seller, shipper, and a host of individuals and entities. We filed a Motion to Dismiss pursuant to Federal Rule 12(b)(1) asserting the Court lacks subject matter jurisdiction as a result of a pre-litigation, full refund offer by our client to the aggrieved consumer. The Court agreed that the full refund offer made in the ordinary course of business operated to moot Plaintiff’s claims, and dismissed the entire action.

 

Public Entity Litigation

Ansell Grimm & Aaron successfully secured summary against Plaintiff on a multi-million dollar claim against the City of Bayonne, wherein Plaintiff alleged that Bayonne discriminated against him when it condemned and subsequently demolished a rental property he owned because it was unsafe. We successfully convinced the Court that the claims were barred by the statute of limitations, that the demolition did not constitute a taking within the meaning of  11 U.S.C. 1983, and that Plaintiff’s tort claims could not be asserted against a municipality as a matter of law, leading to dismissal of the entire case.

 

Ansell Grimm & Aaron Welcomes Lateral Hire to Woodland Park Office

We are pleased to announce Stefan J. Erwin, Esq. has joined Ansell Grimm & Aaron. Mr. Erwin is a Trial Attorney who came to Ansell from an established Newark practice where he represented the largest cities in New Jersey. Mr. Erwin brings nearly a decade of experience to the firm specializing in complex commercial litigation, criminal defense, appellate practice, labor and employment law, public entity, and civil rights. Mr. Erwin graduated from Rutgers University with dual degrees in Political Science and Criminal Justice, and then attended Rutgers Law School where he interned for the Honorable Noel Hillman in the United States District Court for the District of New Jersey. After law school, he clerked for the Honorable James Hely, J.S.C. of the Superior Court Law Division in Union County. He has taught public school children a course in Constitutional Law, founded a local community garden, and sat on the board of a charter school. Mr. Erwin has received several favorable jury verdicts for his clients in the Public Defender’s Office where he litigated cases from inception through appeal.

 

Best of the Best

It is with great pleasure that Ansell Grimm & Aaron, PC has been named “Best of the Best” Law Firm in the 2021 Official Community Choice Awards published by the Asbury Park Press. This recognition is greatly appreciated as it was not determined by the Bar or another professional organization, but rather by the community we serve on a daily basis.

Quarterly Litigation Department Roundup: April 2021

Ansell Grimm April 6, 2021

As the world continues to face the coronavirus pandemic, and millions of small businesses remain confronted with unprecedented challenges, the attorneys in Ansell Grimm & Aaron’s Litigation Department assisted dozens of clients in protecting their businesses and livelihoods.  Led by co-chairs Lawrence Shapiro and Joshua Bauchner, and assisted by attorneys Barry Capp, Anthony D’Artiglio, Rahool Patel, Seth Rosenstein, Ashley Whitney, and, our newest member, Courtney Dunn, the Department is pleased to share its numerous successes.

Real Estate Litigation

In a recent matter before the Honorable Henry P. Butehorn in Monmouth County, Lawrence Shapiro and Seth Rosenstein were successful in securing summary judgment in favor of their clients as to all claims prior to trial.  Plaintiffs asserted causes of action sounding in common law fraud, violations of the New Jersey Consumer Fraud Act, Unjust Enrichment, Negligence, Breach of Contract, and Equitable Servitude in connection with their purchase of real property in Ocean Grove, New Jersey.  The sellers, who own the property sold to Plaintiffs as well as an adjoining property, prohibited the buyers from utilizing a walkway on sellers’ adjoining property to access the rear entrance to buyers’ home.  The buyers asserted that representations were made by sellers as to their ability to utilize sellers’ walkway, and that they overpaid for their property if there was no access through the rear entrance.

Judge Butehorn’s Order found that there was no basis upon which to establish claims for common law fraud or Consumer Fraud against the defendants.  Specifically, the Court agreed with AGA’s argument that any representation as to walkway access on adjacent property was not part of the transaction at issue and thus could not serve as a basis for a claim of fraud or consumer fraud.

Plaintiffs subsequently filed a motion for reconsideration of the Court’s summary judgment order, which was denied, confirming the victory for our client.

Appellate Litigation

Barry Capp succeeded before the Appellate Division in upholding the validity of the City of Asbury Park’s short-term rental (Air BnB) ordinance, which permitted and established procedures for the short-term rental of residential properties. The plaintiff filed a complaint in the Law Division, Monmouth County, alleging that the ordinance was adopted improperly and that Ordinance itself was facially invalid.

The Ordinance defines those classifications of properties where short-term rentals are both permitted and prohibited. It further establishes a permitting process for property owners who wish to utilize their properties as short-term rentals. Plaintiff asserted a challenge to the manner in which the Ordinance was adopted, claiming that it creates a “new” use of residential property that is a non-permitted and, therefore, was required to be adopted as a zoning ordinance pursuant to the procedures contained in the Municipal Land Use Law (MLUL). Plaintiff further claimed that the use of residential property for short-term rentals violates the City of Asbury Park’s zoning ordinance and therefore was required to be invalidated.

In a thirteen (13) page unanimous decision, and a major victory for the City of Asbury Park, the Appellate Division upheld the City’s actions in adopting the Ordinance and its validity pursuant to its municipal police powers. In so doing, the Appellate Division affirmed the right of owners of certain classifications of property to use their properties as short-term rentals pursuant to procedures established by the City of Asbury Park and its governing body.

Bankruptcy Litigation

Joshua Bauchner and Anthony D’Artiglio are pursuing a multi-million dollar cure dispute in Southern District of New York Bankruptcy Court, seeking to compel a retail Debtor who operated a chain of grocery stores to pay for numerous, needed repairs to a large production and distribution facility.  The Debtor failed to maintain the property in the condition required by the Lease, leading to large scale deterioration.  The case presents interesting legal questions at the intersection of commercial landlord-tenant law and Bankruptcy law, particularly in light of the new tenant’s assumption of the Lease “as is” as part of the Bankruptcy proceedings.

Class Action Litigation

Joshua Bauchner and Rahool Patel continue the defense of multiple class actions filed against New Jersey Retrofitness gym franchises.  This now seven-year old litigation is on remand from the Appellate Division, where the firm successfully secured the dismissal of seven of the eight claims, dramatically narrowing the scope of the litigation.  As a result of numerous procedural challenges encountered by plaintiffs, the matter is back at the pleading stage ensuring our already strapped gym clients are not at risk of liability anytime soon.

COVID-19 Litigation

Department attorneys continue to represent national retail and restaurant tenants in numerous COVID-19 Pandemic-related litigations, securing temporary restraints and preliminary injunctive relief to prevent self-help lockouts, restore utilities, permit outdoor dining, and stay eviction actions.  As pandemic law remains largely unsettled, the Firm presented novel legal arguments to secure favorable decisions and settlements on behalf of many clients, and are preparing for what is understood to be the first trial in the State addressing the impact of Governor Murphy’s Executive Orders restricting operations.

Policeman Benevolent Association Litigation

Ashley Whitney is waiting on a decision from the Appellate Division involving the termination of a police officer with no prior discipline for alleged Criminal Justice Information Systems violations under State v. Donis, through his use of full-disclosure searches despite the police department’s failure to identify a single full-disclosure search conducted without justification.  The Appellate Division’s decision could have lasting implications for police officers as there is little case law addressing the application of Donis in this context.

Ms. Whitney also is continuing her prior practice of the representation of police officers as a member of the PBA Legal Protection Plan at the Firm’s Woodland Park office and is currently defending a high-ranking correctional police officer served with inflated disciplinary charges.

Personnel Successes

Courtney Dunn joined as an associate with the Firm. Prior to joining Ansell Grimm & Aaron, Ms. Dunn practiced commercial litigation along with sports and entertainment law, labor and employment law, and toxic tort law at a firm in New York City. Ms. Dunn received her juris doctor, cum laude, from the Elisabeth Haub School of Law at Pace University where she was a Pro Bono Scholar and worked as a research assistant to Professor Donald L. Doernberg. During law school, Ms. Dunn interned for Justice Terry J. Ruderman, J.S.C. of the Supreme Court of New York.  She also served as an Articles Editor on the Pace International Law Review and was a member of the Moot Court Honors Board.

Following law school, Ms. Dunn served as a law clerk to The Honorable Judge Craig L. Wellerson, the Presiding Civil Division Judge of the Ocean Vicinage of the Superior Court of New Jersey. Ms. Dunn is admitted to practice in New Jersey and New York as well as the Southern District of New York and the Eastern District of New York

Anthony D’Artiglio was named as “One To Watch” by Best Lawyers Magazine, for commercial litigation.  We congratulate Mr. D’Artiglio on this remarkable achievement.

AGA’s Jay Feldman appointed Chair of the District III-B Fee Arbitration Committee

Ansell Grimm September 26, 2016

The New Jersey Supreme Court recently appointed AGA Attorney, Jay Feldman as Chair of the District III-B Fee Arbitration Committee. His term as Chair began on September 1, 2016. The New Jersey Supreme Court first appointed Mr. Feldman to District III-B Fee Arbitration Committee in 2013 as a panel member. Mr. Feldman is currently a member of the AGA Litigation and Bankruptcy departments and devotes his practice to the areas of business litigation, real estate litigation, construction litigation, and bankruptcy litigation.

The District Fee Arbitration Committees issue binding determinations deciding disputes filed by clients against their attorneys seeking a review of the amount of attorneys’ fees charged. As Chair, Mr. Feldman’s duties include presiding over fee arbitration hearings each month during which the client, attorney, and any other witnesses testify. Mr. Feldman, along with two other Committee panel members, review the fees charged and determine whether they are reasonable. Mr. Feldman is responsible for preparing written opinions deciding the fee arbitration disputes brought before the District III-B panel.

Mr. Feldman can be reached at jbf@62q.f7d.myftpupload.com or 609-557-1044.

Brian Ansell, Pam Mulligan expand roles with County Bar Associations

Ansell Grimm May 19, 2016

On May 26th AGA Partner Brian E. Ansell will be installed as First Vice President of the Monmouth County Bar Association. AGA Counsel Pamela A. Mulligan will be installed as President of the Burlington County Bar Foundation and as Treasurer of the Burlington County Bar Association on June 3rd.

Mr. Ansell, based in the firm’s Ocean Township office, has been very active with the Monmouth County Bar Association and has been a trustee since 2008 and officer of the Monmouth County Bar Association since 2012. Mr. Ansell focuses his practice in the areas of personal injury, medical malpractice, criminal defense, municipal court, DWI defense, as well as general civil, criminal and chancery litigation including litigation related to wills and estates. Mr. Ansell is Chair of the Civil Practice, Judicial Appointments and Municipal Court Committees and has served on multiple other committees throughout his tenure with the Monmouth County Bar Association. Mr. Ansell’s installation will take place at the Oyster Point Hotel in Red Bank, New Jersey.

Ms. Mulligan currently serves as Secretary for the Burlington County Bar Association and Treasurer of the Burlington County Bar Foundation and has been active with the Burlington County Bar Association and Foundation since 2007. In 2011 Ms. Mulligan was awarded the Robert W. Criscuolo Award from the Burlington County Bar Association for her contributions to the Association and to the Community. Ms. Mulligan is currently the Chair of the Corporate Networking Committee and a member of the Due Diligence, Debtor/Creditor/Bankruptcy, Budget & Finance, CLE, and Women in the Profession Committees. Ms. Mulligan was previously co-chair of the Debtor/Creditor/Bankruptcy and Young Lawyers Committees. She has presented CLEs for the Bar Association on the topics of Bankruptcy and Foreclosure and has moderated other seminars for the Bar Association. Ms. Mulligan focuses her practice in the areas of real estate, creditors’ rights, bankruptcy and intellectual property limited to copyright and trademark. Ms. Mulligan’s installation will take place at Kings Grant Community Center in Marlton, New Jersey.

Mr. Ansell may be reached via email at bea@62q.f7d.myftpupload.com or via his direct line at 732-643-5230.

Ms. Mulligan may be reached via email at pam@62q.f7d.myftpupload.com or via her direct line at 609-557-1045

 

AGA Counsel Pam Mulligan to Share Collections Expertise

Ansell Grimm April 10, 2016

Pamela A. Mulligan, Counsel at Ansell Grimm & Aaron, will be a featured speaker at the National Business Institute’s April 19 seminar on Advanced Collection Law at the Holiday Inn, Cherry Hill, 2175 Marlton Pike. Ms. Mulligan will be speaking about the Consumer Financial Protection Bureau’s (CFPB) effects on collections and staying in compliance with the Fair Debt Collection Practices Act.

To register for the seminar please visit the NBI website at: Advanced Collection Law. Attendance at the seminar satisfies state-mandated continuing legal education requirements for New Jersey, New York and Pennsylvania. The seminar runs from 9 a.m. to 4:30 p.m. with a 1 hour lunch break at 11:45 a.m.

Recent Posts

Ocean, NJ
1500 Lawrence Ave.,
Ocean, NJ 07712
Tel: 732-922-1000
Fax: 732-922-6161
Princeton, NJ
214 Carnegie Center, Suite 112,
Princeton, NJ 08540
Tel: 609-751-5551
Woodland Park, NJ
365 Rifle Camp Rd.,
Woodland Park, NJ 07424
Tel: 973-247-9000
Fax: 973-247-9199
Newtown, PA
41 University Dr., Suite 400,
Newtown, PA 18940
Tel: 267-757-8792
White Plains, NY
140 Grand St., Suite 705,
White Plains, NY 10601
Tel: 800-569-3886
Copyright ©2023 Ansell.Law All rights reserved | Legal Notices | Cookie Policy
Website Design by IQnection - A Digital Marketing Agency
Get In Touch
Linkedin-in Facebook-f Twitter