MFA and Associations File Amicus Curiae Brief in RadLAX Gateway v. Amalgamated Bank Case Before U.S. Supreme Court

March 09, 2012

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Topics: RadLAX Gateway Hotel LLC and RadLAX Gateway Deck LLC v Amagamated Bank write of certiorari, Mortgage Bankers Association, Securities Industry and Financial Markets Association, Loan Syndications and Trading Association, American Bankers Association, Clearing House Association, Commercial Finance Association, Equipment Leasing and Finance Association, Financial Services Roundtable, Elliot Ganz, Seth P. Waxman, Craig Goldblatt, Danielle Spinelli, Eric F. Citron, Shivaprasad Nagaraj, secured creditors, credit-bid, free-and-clear sale, secured credit, amici curiae, trade associations, corporate and commercial loans, mortgage-backed financing, asset-backed financing, private investment fund, borrowers, investment banks, manufacturers, hedge funds, funds of funds, managed futures funds, real-estate finance industry, chapter 11 plan of reorganization, collateral, undervaluation, secured financing, lien, fair and equitable, indubitable equivalent, stalking-horse bidder, Bankruptcy Code, secured creditor, cram-down, non-consenting class of secured creditors, speedy-trial deadline, statutory surplusage, consenual plans, nonconsensual free-and-clear sale, bankruptcy law, cash out, Judge Hand, clear and manifest contrary intention, Justice Brandeis, transfer, sale, sale exception, inconsequential value, valuation, present value, favored bidders, old equity, existing management, bankruptcy estate, available bidders, bidder, white knight bidders, commercial real-estate loans, commercial mortgage-backed securities, CMBS, real estate mortgage investment conduits, REMICs, BFP v. Resolution Trust Corp., Bloate v. United States, Bank of America National Trust & Savings Association v. 203 North LaSalle St. Partnership, D. Ginsberg & Sons Inc. v. Popkin, Dewsnup v. Timm, Duncan v. Walker, Dynamics Corp. of America v. CTS Corp., Easton v. German-American Bank, In re Beker Industries Corp., In re California Hancock Inc., In re FCX Inc., In re Murel Holding Corp., In re Philadelphia Newspapers LLC, In re River East Plaza LLC, In re Yale Express System Inc., Louisville Joint Stock Land Bank v. Radford, Pacific Gas & Electric Co. v. California ex rel. California Department of Toxic Substances Control, Sage v. Central Railroad Co., Toibb v. Radloff, W.B. Worthen Co. v. Kavanaugh, Wright v. Vinton Branch of Mountain Trust Bank,
From: MFA, Loan Syndications and Trading Association, American Bankers Association, Clearing House Association, Commercial Finance Association, Equipment Leasing and Finance Association, Financial Services Roundtable, Mortgage Bankers Association, Securities Industry and Financial Markets Association

To:

Supreme Court of the United States

MFA, with the Loan Syndications and Trading Association, SIFMA, and seven other trade associations submitted an amicus brief in the RadLAX Gateway Hotel, LLC v. Amalgamated Bank case before the U.S. Supreme Court. At issue is whether a secured lender always has the right in bankruptcy to credit-bid on its collateral. We believe it does. The right to credit-bid protects secured lenders against potential undervaluation of their collateral in bankruptcy. A new rule allowing debtors to bar credit-bidding would increase the risk of undervaluation, and thus lead to an increased cost of capital. Such a rule would have a significant negative impact on the market for secured financing.

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