Denise Alvarez Quoted in Law360 Bankruptcy Authority, “Del. Court Extends Ch. 11 Stay To Jambys Execs”
Denise Alvarez, partner in in the Commercial Litigation practice group at Pashman Stein Walder Hayden P.C., was recently quoted in a Law360 Bankruptcy Authority article titled, “Del. Court Extends Ch. 11 Stay To Jambys Execs.” The article discusses a temporary restraining order issued by the United States Bankruptcy Court for the District of Delaware extending the automatic stay to cover the company’s two co-founders and officers with respect to a lender’s collection action on that basis that the officers personally guaranteed many of the debtor’s loan and needed protection from a collection action.
Without the restraining order, Velocity, the lender, would have obtained a default judgment against the two Jambys officers, Jambys argued in its complaint.
The article quotes Alvarez’s argument:
If Velocity's suit were allowed to go forward, Ambrose and Goble, as the company's only employees, would have to spend their time "opposing enforcement actions as opposed to focusing on the restructuring," which would harm Jambys' reorganization efforts, Alvarez told the court.
To prevent collections suits against Ambrose and Goble, who guaranteed many of the loans personally, would be to protect the interests of Jambys, meaning the execs' and the company’s interests are intertwined to a degree that justifies protecting them with the automatic stay, Alvarez argued.
The judge agreed.
Velocity did not appear in court to oppose the motion, and the debtor's counsel said it may not have been served. Jambys is represented by Joseph C. Barsalona II, partner, Katherine R. Beilin, associate, and Amy M. Oden, associate in the firm’s Bankruptcy, Restructuring & Creditors’ Rights practice.
To read the full Law360 article, click here.