Last month, Jeoffrey Burtch (the "Trustee"), as Chapter 7 Trustee for the Opus South Bankruptcy, began filing preference complaints seeking to recover what the Trustee alleges are avoidable transfers under the Bankruptcy Code. For those unfamiliar with the Opus South bankruptcy, the company filed petitions for bankruptcy in the Delaware Bankruptcy Court on April 22, 2009. The Opus South bankruptcy began as a chapter 11 reorganization. However, on August 27, 2010, the Bankruptcy Court entered an order converting the case to a chapter 7 liquidation. The Trustee was appointed on the same day that the case converted to chapter 7.
When Opus South originally filed for bankruptcy, one of the first documents filed with the Bankruptcy Court was a declaration (the "Declaration") of the company's Chief Restructuring Officer. As stated in the Declaration, Opus South was a real estate development corporation headquartered in Atlanta, Georgia. Prior to bankruptcy, the company had developed over 27 million square feet of real estate space. The company's development projects included office, retail, government and multi-family projects. Decl. at *4.
Prior to filing for bankruptcy, Opus South contacted its lenders in an effort to either restructure its loans or turnover properties through a deed-in-lieu of foreclosure. According to the Declaration, the company's pre-bankruptcy efforts "did not result in a resolution of all issues with regard to the Debtors' pre-petition secured loans." Decl. at *15.
Opus South went in to bankruptcy hoping it could sell off properties under a section 363 sale of assets. As the bankruptcy got underway, it became clear that not all of the company's lenders could agree on the terms of a sale of assets. Unable to reach an agreement with its lenders and unable to fund a reorganization, Opus South eventually sought to convert to chapter 7.
The Opus South bankruptcy proceeding is before Judge Mary F. Walrath. Judge Walrath previously served as the Chief Judge of the Delaware Bankruptcy Court. The Chapter 7 Trustee in Opus South is represented by the law firm Cooch and Taylor P.A.