Kramer Levin Naftalis and Frankel LLP’s nationally regarded Bankruptcy Litigation Group has compiled a distinguished record in difficult and high-profile cases. The group, which includes two dedicated partners within the Creditors’ Rights and Bankruptcy Department and several Litigation Department partners with deep bankruptcy experience, has tackled cutting-edge issues and achieved extraordinary results at trial and on appeal for clients in some of the most complex and hotly contested bankruptcies of recent years. We have high profile experience in litigations involving substantive consolidation, plan confirmation, fraudulent conveyance, plan exclusivity, withdrawal of reference, abstention, enterprise valuation, preferences, tort claim estimation, third party releases, appointment of trustees, DIP financing, asset sales and procedures, break up fees and compromises and settlements of disputed claims:

• Adelphia — Kramer Levin represented an ad hoc committee made up of 20 noteholders holding approximately $350 million of notes issued by FrontierVision, a subsidiary of Adelphia. Adelphia was sold to Time Warner and Comcast for a record sale price of over $17 billion. Kramer Levin conducted an active litigation on behalf of the FrontierVision Noteholders on the critical issues of validity and priority of intercompany claims, allocation of the value from the Time Warner sale between debtor groups, substantive consolidation and plan confirmation, all of which resulted in a favorable settlement for the FrontierVision Noteholders.
• WorldCom — We represented subordinated MCI bondholders in litigation opposing confirmation of a plan of reorganization that sought to substantively consolidate the MCI and WorldCom estates — and pay our clients nothing — based on the Debtors’ assertion that it was impossible to disentangle nearly one-third of a trillion dollars in intercompany transactions. We developed approaches to demonstrate that MCI was in fact solvent. We obtained a $334 million settlement for the bondholder class, increasing their recovery from zero to 44 percent.
• Adelphia Business Solutions (ABIZ) — We represented the Creditors Committee in litigation against ABIZ’s corporate parent, Adelphia Communications Corp. We obtained a bankruptcy court ruling estimating ACC’s $70 million in claims against ABIZ at less than $3 million. That ruling led to a $200 million settlement of ABIZ’s claims against ACC, a result that doubled the overall recovery for ABIZ’s creditors.
• NorthWestern Corp. — We represented subordinated bondholders in litigation opposing confirmation of the debtors’ initial plan of reorganization. We obtained a settlement valued at $120 million, more than four times the value provided by the initial plan.
• Owens Corning — In the bankruptcy of Owens Corning, a mass tort bankruptcy of national prominence, Kramer Levin has represented Credit Suisse First Boston, as Agent for a consortium of 47 bank lenders with $1.6 billion of debt, in opposing efforts by bondholders and asbestos creditors of Owens Corning to use substantive consolidation or fraudulent conveyance theories to set aside guarantees obtained by the banks against several debtor and nondebtor OC subsidiaries. The firm spearheaded massive discovery, including depositions of more than 30 witnesses, and a trial of the substantive consolidation issues, and played a key role in an appeal that resulted in an historic decision by the Third Circuit Court of Appeals ruling out substantive consolidation in the Owens Corning case. Kramer Levin also has been involved on behalf of the Owens Corning bank group in active litigation over tort claims estimation, exclusivity, constructive trust and
  appointment of a trustee.
• WCI Steel — Kramer Levin represented the holders of $300 million in senior secured notes issued by WCI Steel, the nation’s seventh largest integrated steelmaker. After terminating exclusivity and defeating two plans filed by the debtor and its shareholder, Ira Leon Rennert, Kramer Levin confirmed a Noteholder plan with the unprecedented support of the United Steelworkers of America. The Noteholder plan gave our clients $100 million in new notes, cash to pay legal fees and expenses, and 99% of the equity of the reorganized company. The Noteholder plan also left Mr. Rennert with responsibility for WCI’s pre-bankruptcy underfunded pension plan. The old Notes, which traded in the 20s upon WCI Steel’s default in 2003, were trading at about par at the consummation of the Noteholder plan.
• Dow Corning — For the Tort Claimants’ Committee we successfully defended on appeal a $3.17 billion settlement that provided enhanced payments for breast implant and other tort claimants against Dow Corning. We blocked Dow Corning’s non-negotiated plan at the disclosure statement stage, as well as litigated over exclusivity, claim transfer and abstention, and achieved withdrawal of the reference. We successfully addressed the efficacy of third-party releases and the elimination of punitive damages.
• SGL Carbon —The Third Circuit Court of Appeals ordered dismissal of the SGL bankruptcy on the ground that it had been filed in “bad faith” — the first such ruling in a chapter 11 case involving a substantial operating company.
• Island Mortgage Network — We successfully litigated to establish a process to identify claims to multiple portfolios of mortgages that in many cases had been funded through fraud and then to sell those mortgages for the benefit of the estates and the competing claimants to the mortgages. The Trustee was able to obtain values approaching par for otherwise badly tainted assets. Thereafter, we successfully prosecuted more than 20 claims against participants in the Debtors’ fraud and other institutions that had fraudulently or improperly received assets of the prepetition debtors, obtaining substantial additional recoveries for the estates.