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United States District Court for the Southern District of New York
November 30, 2018, Decided; November 30, 2018, Filed
[*419] AMENDED OPINION & ORDER
NELSON S. ROMÁN, United States District Judge
This appeal arises from the United States Bankruptcy Court for the Southern District of New York (Robert D. Drain, B.J.). It pertains to the Bankruptcy Court's granting Appellees' Motions to Dismiss pursuant to Fed. R. Civ. P. 12(b)(6) and 12(c), and it raises five principal questions. The first regards whether the Bankruptcy Court erred in finding, as a matter of law, that the Appellees [**4] did not [*420] breach the Intercreditor Agreement ("ICA"), a contract governed by New York law, by voting in favor of MPM's reorganization plan that Appellants opposed. The next three concern whether the Bankruptcy Court erred in finding, as a matter of law, that the Appellants failed to raise a plausible claim for breach of the ICA with regards to three actions: (1) Appellees' receiving equity in reorganized stock in exchange for releasing their claims on certain collateral that Appellees and Appellants shared; (2) Appellees' receiving and retaining a certain "BCA Fee" prior to Appellants receiving a payment in full cash for their liened securities; and (3) Appellees' receiving payment of their professional fees prior to the Appellants receiving a payment in full cash for their liened securities. The fifth question is whether the Bankruptcy Court erred in dismissing, as a matter of law, Appellants' alternative claim for breach of the covenant of good faith and fair dealing.
The Court has reviewed the parties' briefs, exhibits incorporated into the complaint by reference, the Bankruptcy Court's Order Granting Defendants' Motion to Dismiss and Motion for Judgment on The Pleadings, entered on [**5] October 15, 2014 ("First Order"),1 and the Bankruptcy Court's Subsequent Orders Denying Plaintiff's Motion for Leave to File an Amended Complaint, entered on January 29, 2015 ("Second Order")2 and on May 14, 2015 ("Third Order").3 For the reasons set forth in the Bankruptcy Court's well-reasoned Orders and additional reasons that this Court relays below, this Court AFFIRMS the Bankruptcy Court's Orders in their entirety.
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596 B.R. 416 *; 2018 U.S. Dist. LEXIS 204136 **
In re: MPM SILICONES, L.L.C., Debtor, BOKF, NA, IN ITS CAPACITY AS TRUSTEE, et al, Plaintiff-Appellants, -against- WILMINGTON SAVINGS FUND SOCIETY, FSB, in its capacity as trustee, et al, Defendants-Appellees.WILMINGTON TRUST, NATIONAL ASSOCIATION, in its capacity as trustee, Plaintiff-Appellants, -against- WILMINGTON SAVINGS FUND SOCIETY, FSB, in its capacity as trustee, et al, Defendants-Appellees.
Prior History: BOKF, N.A. v. JPMorgan Chase Bank, N.A. (In re MPM Silicones, LLC), 518 B.R. 740, 2014 Bankr. LEXIS 4353 (Bankr. S.D.N.Y., Oct. 14, 2014)
Collateral, Seniors, rights, bankruptcy court, Noteholders, proceeds, secured creditor, liens, reorganized, remedies, lenders, provisions, professional fees, first lien, restructuring, holders, matter of law, second lien, pleadings, fulcrum, adequate protection, subordinated, common stock, parties, unsecured creditor, negotiated, secured claim, waive, amended complaint, Notice