In re Online King LLC

In re Online King LLC

Opinion

 [*342]  MEMORANDUM DECISION DENYING DEBTOR'S MOTION FOR AN ORDER EXTENDING TIME TO FILE A PLAN¹

On July 10, 2020, Online King LLC (the "Debtor") filed a chapter 11 petition and elected application of subchapter V of chapter 11, codified in 11 U.S.C. §§ 1181-1195.² ] In a subchapter V case, only the debtor may file a plan. 11 U.S.C. § 1189(a). The plan must be filed within 90 days of the entry of the order for relief, except that the court may extend the 90-day period under limited circumstances, to wit, if a debtor demonstrates that the "need for the extension is attributable to circumstances for which the debtor should not justly be held accountable." 11 U.S.C. § 1189(b). Here, the 90-day period expired on October 8, 2020. The Debtor did not file a plan nor request an extension of the 90-day period prior to October 8, 2020.

 [*343]  Now before the Court is a motion filed by the Debtor, dated October 21, 2020³ [Dkt. No. 63] (the "Motion"), for entry of an order extending the 90-day period by an additional 90 days without [**2]  prejudice to the Debtor's right to request a further extension of time. The Motion does not mention that the 90-day period has expired nor does it cite to any authority to support the request for an extension other than a passing reference to § 1189(b). No affidavit or declaration was submitted by the principal of the Debtor, and the Motion is signed by counsel. The Motion asserts, in conclusory fashion, that an extension is justified because of (i) "the amount of work entailed in negotiating and proposing a plan," (ii) "the intervening Jewish holidays during which the Debtor and its Counsel could not work," (iii) "the competing demands upon Debtors [sic] advisors and personnel," and (iv) "the inherent issues faced by all parties because of the current pandemic." Motion ¶ 8. No explanation is given as to how the religious holidays or the pandemic affected the Debtor and its operations, nor does the Motion describe what steps the Debtor has taken to propose a plan since this chapter 11 case was commenced on July 10, 2020 and when a plan might be forthcoming. In short, the Motion consists of factually unsupported and conclusory labels, and it is on that basis that the Debtor asks this Court to [**3]  retroactively extend its time to file a plan by an additional 90 days.

While neither the Debtor nor any other party has raised the question of whether this Court has the authority to grant retroactive relief by entering a nunc pro tunc order to erase the gap occasioned by the expiration of the 90-day time period within which a debtor shall file a plan, it is a question that the Court must address in light of the United States Supreme Court decision in Roman Catholic Archdiocese of San Juan, Puerto Rico v. Acevedo Feliciano, 140 S. Ct. 696, 206 L. Ed. 2d 1 (2020). See In re Benitez, No. 8-19-70230-reg, 2020 Bankr. LEXIS 661, 2020 WL 1272258, at *1 (Bankr. E.D.N.Y. Mar. 13, 2020). Accordingly, the Court first considers whether, in view of Acevedo, which limited the use of nunc pro tunc ("now for then") orders, it is appropriate to extend by 90 days the Debtor's time to file a plan nunc pro tunc to October 8, 2020. Next, the Court addresses the merits of the Debtor's request for an extension of time under § 1189(b) as if the Motion had been filed and heard before the expiration of the 90-day period. In other words, even if this Court has the authority to enter a nunc pro tunc order extending by 90 days the Debtor's time to file its plan, did the Debtor meet its burden of demonstrating, by affirmative evidence, that an extension is justified in this case. The answer to [**4]  each of these questions is of great consequence to the Debtor because the failure to file a plan within the statutory time period constitutes "cause" to convert or dismiss a chapter 11 case under § 1112(b)(4)(J).⁴

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