October Term 2011 · Docket 11-166
Can secured creditors credit bid in Chapter 11 sales?
The dispute centers on whether the Bankruptcy Code bars secured creditors from credit bidding when a Chapter 11 plan sells their collateral.
Verified source milestones
- — An official oral-argument transcript was verified.
- — An official oral-argument transcript was verified.
The arguments, in order
This case may have been argued more than once. Each entry below uses that session's official transcript. Later arguments do not erase earlier ones.
Argument 1 ·
What happened at the argument
Ms. Maynard argued secured creditors bargain for full repayment or foreclosure rights.
Mr. Neff argued the Bankruptcy Code plainly says no to credit bidding in Chapter 11.
Chief Justice Roberts questioned if credit bidding deprives creditors of holding devalued assets.
Justice Alito questioned if the dispute arises from doubts about the indubitable equivalent standard.
Read the official transcript for this argument · Official argument details
Sources used for this argument breakdown
- Official Supreme Court Transcript — file page 27, lines 35-15 — Transcript, file page 27, lines 35-15
- Official Supreme Court Transcript — file page 3, lines 19-27 — Transcript, file page 3, lines 19-27
- Official Supreme Court Transcript — file page 3, lines 7-17 — Transcript, file page 3, lines 7-17
- Official Supreme Court Transcript — file page 4, lines 29-33 — Transcript, file page 4, lines 29-33
- Official Supreme Court Transcript — file page 4, lines 43-49 — Transcript, file page 4, lines 43-49
- Official Supreme Court Transcript — file page 46, lines 13-15 — Transcript, file page 46, lines 13-15
- Official Supreme Court Transcript — file page 5, lines 21-23 — Transcript, file page 5, lines 21-23
- Official Supreme Court Transcript — file page 5, lines 35-41 — Transcript, file page 5, lines 35-41
- Official Supreme Court Transcript — file page 56, lines 15-9 — Transcript, file page 56, lines 15-9
- Official Supreme Court Transcript — file page 57, lines 11-23 — Transcript, file page 57, lines 11-23
- Official Supreme Court Transcript — file page 57, lines 27-29 — Transcript, file page 57, lines 27-29
- Official Supreme Court Transcript — file page 57, lines 41-45 — Transcript, file page 57, lines 41-45
- Official Supreme Court Transcript — file page 58, lines 33-37 — Transcript, file page 58, lines 33-37
- Official Supreme Court Transcript — file page 6, lines 13-21 — Transcript, file page 6, lines 13-21
- Official Supreme Court Transcript — file page 6, lines 25-29 — Transcript, file page 6, lines 25-29
- Official Supreme Court Transcript — file page 6, lines 43-5 — Transcript, file page 6, lines 43-5
- Official Supreme Court Transcript — file page 7, lines 15-19 — Transcript, file page 7, lines 15-19
- Official Supreme Court Transcript — file page 7, lines 29-35 — Transcript, file page 7, lines 29-35
- Official Supreme Court Transcript — file page 7, lines 45-47 — Transcript, file page 7, lines 45-47
- Official Supreme Court Transcript — file page 8, lines 13-21 — Transcript, file page 8, lines 13-21
- Official Supreme Court Transcript — file page 8, lines 37-45 — Transcript, file page 8, lines 37-45
A citizen's guide to the whole case
What this case is about
This case tests the scope of credit bidding rights under the Bankruptcy Code. the sides that brought the case argue the statute prohibits credit bidding in Chapter 11 plan sales. the opposing sides argue secured creditors retain the right to credit bid to protect their collateral value.
Official sources for this section
- Official Supreme Court Transcript — file page 27, lines 35-15 — Transcript, file page 27, lines 35-15
- Official Supreme Court Transcript — file page 3, lines 19-27 — Transcript, file page 3, lines 19-27
- Official Supreme Court Transcript — file page 46, lines 13-15 — Transcript, file page 46, lines 13-15
- Official Supreme Court Transcript — file page 56, lines 15-9 — Transcript, file page 56, lines 15-9
How the case got here
The Supreme Court heard oral argument in this case on April 23, 2012.
Official sources for this section
- Official Supreme Court Transcript — file page 3, lines 7-17 — Transcript, file page 3, lines 7-17
- Official Supreme Court Transcript — file page 56, lines 15-9 — Transcript, file page 56, lines 15-9
What each side wants
the sides that brought the case want the Court to bar credit bidding in Chapter 11 plan sales.
the opposing sides want the Court to allow credit bidding to protect collateral value.
Official sources for this section
- Official Supreme Court Transcript — file page 27, lines 35-15 — Transcript, file page 27, lines 35-15
- Official Supreme Court Transcript — file page 3, lines 19-27 — Transcript, file page 3, lines 19-27
- Official Supreme Court Transcript — file page 46, lines 13-15 — Transcript, file page 46, lines 13-15
- Official Supreme Court Transcript — file page 56, lines 15-9 — Transcript, file page 56, lines 15-9
What each side says
the sides that brought the case argue the Bankruptcy Code plainly prohibits credit bidding in Chapter 11 plan sales.
the opposing sides argue secured creditors bargained for the right to foreclose and take collateral.
Official sources for this section
- Official Supreme Court Transcript — file page 27, lines 35-15 — Transcript, file page 27, lines 35-15
- Official Supreme Court Transcript — file page 3, lines 19-27 — Transcript, file page 3, lines 19-27
- Official Supreme Court Transcript — file page 46, lines 13-15 — Transcript, file page 46, lines 13-15
- Official Supreme Court Transcript — file page 56, lines 15-9 — Transcript, file page 56, lines 15-9
What the justices asked
Chief Justice Roberts asked if credit bidding deprives creditors of holding devalued assets.
Justice Alito asked if the dispute stems from doubts about the indubitable equivalent standard.
Official sources for this section
- Official Supreme Court Transcript — file page 4, lines 29-33 — Transcript, file page 4, lines 29-33
- Official Supreme Court Transcript — file page 4, lines 43-49 — Transcript, file page 4, lines 43-49
- Official Supreme Court Transcript — file page 5, lines 21-23 — Transcript, file page 5, lines 21-23
- Official Supreme Court Transcript — file page 5, lines 35-41 — Transcript, file page 5, lines 35-41
- Official Supreme Court Transcript — file page 57, lines 11-23 — Transcript, file page 57, lines 11-23
- Official Supreme Court Transcript — file page 57, lines 27-29 — Transcript, file page 57, lines 27-29
- Official Supreme Court Transcript — file page 57, lines 41-45 — Transcript, file page 57, lines 41-45
- Official Supreme Court Transcript — file page 58, lines 33-37 — Transcript, file page 58, lines 33-37
- Official Supreme Court Transcript — file page 6, lines 13-21 — Transcript, file page 6, lines 13-21
- Official Supreme Court Transcript — file page 6, lines 25-29 — Transcript, file page 6, lines 25-29
- Official Supreme Court Transcript — file page 6, lines 43-5 — Transcript, file page 6, lines 43-5
- Official Supreme Court Transcript — file page 7, lines 15-19 — Transcript, file page 7, lines 15-19
- Official Supreme Court Transcript — file page 7, lines 29-35 — Transcript, file page 7, lines 29-35
- Official Supreme Court Transcript — file page 7, lines 45-47 — Transcript, file page 7, lines 45-47
- Official Supreme Court Transcript — file page 8, lines 13-21 — Transcript, file page 8, lines 13-21
- Official Supreme Court Transcript — file page 8, lines 37-45 — Transcript, file page 8, lines 37-45
Why it matters
Credit bidding affects how much cash enters bankruptcy sales. It determines whether secured creditors can offset debt with collateral value. This impacts the final distribution of assets to all stakeholders.
Official sources for this section
- Official Supreme Court Transcript — file page 27, lines 35-15 — Transcript, file page 27, lines 35-15
- Official Supreme Court Transcript — file page 3, lines 19-27 — Transcript, file page 3, lines 19-27
- Official Supreme Court Transcript — file page 46, lines 13-15 — Transcript, file page 46, lines 13-15
- Official Supreme Court Transcript — file page 56, lines 15-9 — Transcript, file page 56, lines 15-9
What happens next
This article currently covers the argument record. Use the official docket link for later case activity.
Official sources for this section
- Official Supreme Court Transcript — file page 3, lines 7-17 — Transcript, file page 3, lines 7-17
- Official Supreme Court Transcript — file page 4, lines 29-33 — Transcript, file page 4, lines 29-33
- Official Supreme Court Transcript — file page 4, lines 43-49 — Transcript, file page 4, lines 43-49
- Official Supreme Court Transcript — file page 5, lines 21-23 — Transcript, file page 5, lines 21-23
- Official Supreme Court Transcript — file page 5, lines 35-41 — Transcript, file page 5, lines 35-41
- Official Supreme Court Transcript — file page 56, lines 15-9 — Transcript, file page 56, lines 15-9
- Official Supreme Court Transcript — file page 57, lines 11-23 — Transcript, file page 57, lines 11-23
- Official Supreme Court Transcript — file page 57, lines 27-29 — Transcript, file page 57, lines 27-29
- Official Supreme Court Transcript — file page 57, lines 41-45 — Transcript, file page 57, lines 41-45
- Official Supreme Court Transcript — file page 58, lines 33-37 — Transcript, file page 58, lines 33-37
- Official Supreme Court Transcript — file page 6, lines 13-21 — Transcript, file page 6, lines 13-21
- Official Supreme Court Transcript — file page 6, lines 25-29 — Transcript, file page 6, lines 25-29
- Official Supreme Court Transcript — file page 6, lines 43-5 — Transcript, file page 6, lines 43-5
- Official Supreme Court Transcript — file page 7, lines 15-19 — Transcript, file page 7, lines 15-19
- Official Supreme Court Transcript — file page 7, lines 29-35 — Transcript, file page 7, lines 29-35
- Official Supreme Court Transcript — file page 7, lines 45-47 — Transcript, file page 7, lines 45-47
- Official Supreme Court Transcript — file page 8, lines 13-21 — Transcript, file page 8, lines 13-21
- Official Supreme Court Transcript — file page 8, lines 37-45 — Transcript, file page 8, lines 37-45
Official Court provenance
Official docket and case history · Official Supreme Court oral-argument detail page
Title and summary sources
- Official Supreme Court Transcript — file page 27, lines 35-15 — Transcript, file page 27, lines 35-15
- Official Supreme Court Transcript — file page 3, lines 19-27 — Transcript, file page 3, lines 19-27
- Official Supreme Court Transcript — file page 46, lines 13-15 — Transcript, file page 46, lines 13-15
- Official Supreme Court Transcript — file page 56, lines 15-9 — Transcript, file page 56, lines 15-9
- Official Supreme Court Transcript — file page 27, lines 35-15 — Transcript, file page 27, lines 35-15
- Official Supreme Court Transcript — file page 3, lines 19-27 — Transcript, file page 3, lines 19-27
- Official Supreme Court Transcript — file page 46, lines 13-15 — Transcript, file page 46, lines 13-15
- Official Supreme Court Transcript — file page 56, lines 15-9 — Transcript, file page 56, lines 15-9
Revision history
- Revision 1 · Official Transcript ·
Correction: Rewritten to the concise citizen-facing editorial standard.
- Revision 2 · Official Transcript ·
Correction: Migrated to the dated official Court activity contract without model use.