Newsroom - September 2010

The firm's bankruptcy team, led by Ed Dobbs, Rufus Dorsey and David Freedman, have been representing The Colonial BancGroup, Inc., as debtor-in-possession in the Chapter 11 bankruptcy proceeding that is pending in the United States Bankruptcy Court for the Middle District of Alabama, in Montgomery. Early in the case, the FDIC, as receiver for Colonial Bank (the wholly owned subsidiary of the Chapter 11 debtor), asserted a priority claim against the Chapter 11 estate in an amount approaching $1 billion, sought to convert the case from Chapter 11 to Chapter 7 based upon the Chapter 11 debtor's failure to cure an alleged capital maintenance commitment pursuant to requirements of the Bankruptcy Code, and sought to offset approximately $36 million of bank deposits of the Chapter 11 debtor that had been transferred by the FDIC, upon closure of Colonial Bank, to Branch Banking and Trust Company. In a significant ruling handed down on August 31, 2010, the bankruptcy court, adopting the position advocated by the bankruptcy team on behalf of the Chapter 11 debtor, concluded that no capital maintenance commitment existed, and the priority claim therefore could not be allowed. In addition, the bankruptcy court found that, absent some other claim that the FDIC might have against the Chapter 11 debtor that would form the basis for a potential offset, the FDIC request to offset the bank accounts would be denied. This decision is a significant one for bank holding company bankruptcy cases throughout the country.

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Upcoming Events

2/28/2019 - Tracy Field, a healthcare partner in our Atlanta office, will be presenting "Legal and Practical Considerations in Analyzing Potential Overpayments" at the Long Term Care and the Law program for the American Health Lawyers Association in Phoenix, Arizona, on February 28 and March 1.

3/29/2019 - Tracy Field, a healthcare partner in our Atlanta office, will be presenting "Anatomy of an Overpayment Analysis for Providers" at the North Carolina Healthcare Financial Management Association's 2019 Annual Conference in Pine Hurst, North Carolina, on March 29.

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