In Re: Windstream Holdings, Inc.
- Vincent Briccetti
- 7:20-cv-04276
- U.S. District Court · Southern District of New York
- 8
U.S. Bank v. Windstream: Judge Briccetti consolidated the bankruptcy appeals but denied expedited review.
U.S. Bank National Association and CQS (US), LLC received a combined appeal but not expedited review; the Windstream Debtors and Uniti were affected by the consolidated appellate proceedings.
What happened
In U.S. Bank National Association v. Windstream Holdings, Inc. et al., U.S. Bank and CQS appealed bankruptcy-court orders approving a settlement and confirming Windstream’s reorganization plan. They asked the district court to combine the appeals and hear them faster.
The appellants argued that delay could allow the plan and settlement to be completed, potentially making the appeals effectively moot and causing financial losses. The Debtors agreed that the appeals should be combined but opposed faster review.
Judge Vincent L. Briccetti granted the motion to the extent it sought consolidation and denied it to the extent it sought expedited review. He ruled that the possibility of an appeal becoming effectively moot was not enough by itself to show the serious harm required for expedited action.
The detailed version
- In Re: Windstream Holdings, Inc. · No. 7:20-cv-04276
- Vincent Briccetti
- Aug. 3, 2020
Background
Windstream Holdings, Inc. and its debtor subsidiaries filed for Chapter 11 bankruptcy protection after U.S. Bank obtained a judgment against Windstream Services, LLC. In the bankruptcy case, the Debtors asserted claims against Uniti Group, Inc. concerning a 2015 transaction. The Debtors and Uniti later settled those claims, with Uniti agreeing to pay the Debtors $1.2 billion.
The bankruptcy court approved the settlement on May 12, 2020, and confirmed the Debtors’ Chapter 11 reorganization plan on June 26, 2020. U.S. Bank appealed both orders. U.S. Bank and CQS (US), LLC appealed the confirmation order. The appellants then moved to consolidate the appeals and to have them heard on an expedited basis.
Consolidation
The court granted the motion to the extent it sought consolidation. Under the applicable rules, appeals may be consolidated when they involve common legal or factual questions. The court found that the settlement and confirmation orders involved the same facts or similar parties, were issued by the same bankruptcy judge, and were interrelated. The Debtors did not oppose consolidation.
Expedited review
The court denied the motion to the extent it sought expedition. An emergency request for expedited action requires a showing that serious harm would occur during the time needed to respond. The appellants argued that completing the reorganization plan and settlement could lead the Debtors to argue that the appeals had become “equitably moot”—a doctrine allowing a bankruptcy appeal to be dismissed when providing relief would unfairly disrupt a reorganized company’s plan—even if some relief could technically be fashioned.
The court concluded that this risk exists in any appeal after confirmation of a Chapter 11 plan and, standing alone, did not establish serious harm. It also ruled that the appellants’ asserted monetary losses were insufficient because monetary loss generally does not constitute irreparable harm. The court further rejected the appellants’ reliance on precedent concerning expedited appeals and their argument that expedition was not an extraordinary remedy.
Disposition
Judge Vincent L. Briccetti granted the motion only to the extent it sought to consolidate the appeals and denied the motion to the extent it sought expedition. The Clerk was directed to consolidate Case Nos. 20 CV 4276, 20 CV 5440, and 20 CV 5529, with Case No. 20 CV 4276 as the lead case. The court directed the appellants to advise whether they intended to file an amended brief and stated that it would later set a briefing schedule. The scheduled conference was cancelled.
Read the full 8-page opinion on CourtListener, the free public archive maintained by the Free Law Project.