July 14, 2009
As you know, on Monday, September 15, 2008, Lehman Brothers Holdings Inc. ("Lehman Holdings") filed a voluntary petition under chapter 11 of the United States Bankruptcy Code (the "Bankruptcy Code"), with the United States Bankruptcy Court for the Southern District of New York.[1] Subsequently, the following Lehman Holdings affiliates filed voluntary petitions under chapter 11 of the Bankruptcy Code: LB 745 LLC, PAMI Statler Arms LLC, Lehman Brothers Commodity Services, Lehman Brothers Special Financing Inc., Lehman Brothers OTC Derivatives Inc., Lehman Brothers Derivative Products Inc., Lehman Commercial Paper Inc., Lehman Brothers Commercial Corp., Lehman Brothers Financial Products Inc., Lehman Scottish Finance L.P., CES Aviation LLC, CES Aviation V LLC, CES Aviation IX LLC, East Dover Limited, Luxembourg Residential Properties Loan Finance S.a.r.l., BNC Mortgage LLC, Structured Asset Securities Corporation, LB Rose Ranch, and LB 2080 Lalakaua Owners LLC (each a "Lehman Debtor" and, together with Lehman Holdings, the "Lehman Debtors"). All these chapter 11 cases are being jointly administered under In re Lehman Brothers Holdings Inc., et al., Case Number 08-13555 (JMP) (each a "Chapter 11 Case" and, together, the "Chapter 11 Cases").[2]
The Proposed Bar Date
The United States Bankruptcy Court for the Southern District of New York has approved September 22, 2009 at 5:00 p.m. (Eastern) as the deadline for all creditors, including affiliates of the Lehman Debtors, to file proofs of claim based on claims against the Lehman Debtors (the "Bar Date"). The Bar Date applies to claims arising prior to the date such Lehman Debtor filed its voluntary petition (the "Petition Date").[3] The proofs of claim with respect to such claims (the "Pre-petition Claims"), must be actually received by Epiq Bankruptcy Solutions, the claims agent for the Lehman Debtors, or filed with the Clerk of the Bankruptcy Court on or before the Bar Date. Any creditor whose claim is not actually received by Epiq Bankruptcy Solutions or the Clerk of the Bankruptcy Court on or before the Bar Date will be forever barred from asserting such claim against the Lehman Debtors, the claim will be discharged, and the creditor will not be permitted to vote on any chapter 11 plan or participate in any distribution with respect to such claim.
There is a separate deadline for holders of certain Lehman Program Securities to file claims against the Lehman Debtors of November 2, 2009 at 5:00 p.m. (Eastern) (the "Lehman Securities Program Bar Date"). The Lehman Program Securities are securities issued by the Lehman Debtors or their affiliates outside of the United States, and identified at www.lehman-docket.com, under the heading "Lehman Program Securities." The list will include the ISIN and CUSIP numbers for each Lehman Program Security. The Notice of the Lehman Securities Program Bar Date will be distributed through Euroclear and Clearstream, and published internationally. Holders of Lehman Program Securities which are guaranteed by a Lehman Debtor do not have to complete the guarantee questionnaire (see below), but do have to submit a separate proof of claim with respect to the guarantee against such Lehman Debtor.
Derivative Contract Claims
As of the Petition Date, the Lehman Debtors were party to more than 906,000 derivatives contracts. Creditors holding claims based on derivative contracts will need to complete several steps in order to file their claims: (i) on or before the Bar Date, complete and file the proof of claim form, checking the appropriate box on the claim form indicating that the claim is based on a derivatives contract; (ii) on or before October 22, 2009 at 5:00 p.m. (Eastern), complete an online questionnaire relating to the derivative contract at a dedicated website (www.lehman-claims.com); and (iii) on or before October 22, 2009 at 5:00 p.m. (Eastern), electronically upload supporting documentation to the dedicated website (www.lehman-claims.com). In addition, if you have a claim based on the guarantee of a derivative contract by a Lehman Debtor, you must separately complete the steps listed below for the guarantee claim by the same deadlines established for derivative contracts. Failure to comply with the procedures will result in the disallowance of the claim and a bar to recovery thereon.
Guarantee Claims
Creditors holding claims against the Lehman Debtors that are based on a guarantee will also have to complete several steps in order to file their claims: (i) on or before the Bar Date, complete and file the proof of claim form, checking the appropriate box on the claim form indicating that the claim is based on a guarantee, (ii) on or before October 22, 2009 at 5:00 p.m. (Eastern), complete an online questionnaire relating to the guarantee at a dedicated website (www.lehman-claims.com); and (iii) on or before October 22, 2009 at 5:00 p.m. (Eastern), electronically upload supporting documentation to the dedicated website (www.lehman-claims.com). Where the claim is based on a guarantee of a derivative contract, creditors will have to file a proof of claim for each of the Lehman Debtors (the derivative counterparty and the guarantor) and complete both the derivative and guarantee questionnaires.
Although generally the proofs of claim are public information, the information submitted on the dedicated website (www.lehman-claims.com), with respect to guarantee and derivative claims, will not be accessible to any parties other than the party submitting such information, the Lehman Debtors, the Creditors Committee and their respective advisors and counsel.
Any creditor who files a proof of claim but fails to complete the applicable questionnaire(s) will be enjoined from asserting such claim and such claim will be discharged. In addition, such creditor will not be permitted to vote on any chapter 11 plan or participate in any distribution with respect to such claim.
Executory Contract and Unexpired Lease Claims
Where the creditor holds a claim arising from the rejection of an executory contract or unexpired lease, the proof of claim must be filed by the later of (i) the Bar Date and (ii) the date which is 45 days following the effective date of such rejection.
Bar Date Procedures
The Court has approved a specific proof of claim form, which includes boxes to check if the claim is based on a guarantee or a derivative transaction. Each creditor will be mailed a proof of claim form with a unique identification number and instructions for filing such form. If a creditor does not receive a proof of claim form with the unique identification number, it will still be able to file a claim on or before the Bar Date, but will have to state in its proof of claim that it is filing a proof of claim without the unique identification number. All proofs of claim must be in English, set forth the name and case number of the specific Lehman Debtor against which it is filed, set forth with specificity the legal and factual basis of the claim, include supporting documentation or an explanation of why such documentation is not available, and denominate the claim(s) in US Dollars. The proof of claim form must be dated and signed by the creditor or by an authorized agent.
Claim forms sent by first class mail should be addressed to:
Lehman Brothers Holdings Claim Processing
c/o Epiq Bankruptcy Solutions, LLC
FDR Station, P.O. Box 5076
New York, NY 10150-5076
Claim forms sent by overnight mail or hand delivery should be addressed to:
Epiq Bankruptcy Solutions, LLC
Attn: Lehman Brothers Holdings Claims Processing
757 Third Avenue, 3rd Floor
New York, NY 10017
Or to:
Clerk of the United States Bankruptcy Court
Attn: Lehman Brothers Holdings Claims Processing
One Bowling Green
New York, NY 10004
Claims will not be accepted by email, facsimile or telecopy. Proofs of claim must be actually received by Epiq Bankruptcy Solutions or the Clerk of the Bankruptcy Court on or before the Bar Date. Deposit in the mail or transmission by overnight mail on the Bar Date will not constitute a timely filed claim.
____________
[1] Other Lehman entities have subsequently filed for bankruptcy protection in other jurisdictions. For example, Lehman Brothers International (Europe), Lehman Brothers Ltd., Lehman Brothers Holdings PLC and LB UK RE Holdings Ltd. filed for administration in the United Kingdom, Lehman Brothers Finance S.A. is in a bankruptcy liquidation proceeding in Switzerland and Lehman Brothers Holdings Japan Inc. and Lehman Brothers Japan Inc. filed for civil rehabilitation in Japan. Claims against Lehman affiliates that are subject to a foreign bankruptcy proceeding will be administered in those foreign proceedings, and are not subject to the Bar Date and procedures set in the Chapter 11 Cases.
[2] On September 19 2008, a proceeding was commenced under the Securities Investor Protection Act of 1970 ("SIPA") with respect to Lehman Brothers Inc. ("LBI") and a trustee appointed under SIPA is administering the LBI estate. The bar date for claims against LBI was January 30, 2009 for all customer claims and June 1, 2009 for all general creditor claims. Claims against LBI will be administered in the SIPA proceeding, currently pending under Case Number 08-01420 (JMP) before the United States Bankruptcy Court for the Southern District of New York, and are not subject to the Bar Date set in the Chapter 11 Cases.
[3] The Petition Dates will be different for each Lehman Debtor. The Petition Date for Lehman Holdings is September 15, 2008. The Petition Date for Lehman Brothers Commodity Services, Lehman Brothers Special Financing Inc., and Lehman Brothers OTC Derivatives Inc. is October 3, 2008. The Petition Date for Lehman Brothers Derivative Products Inc., Lehman Commercial Paper Inc., Lehman Brothers Commercial Corp., Lehman Brothers Financial Products Inc., Lehman Scottish Finance, L.P., CES Aviation LLC, CES Aviation V LLC, CES Aviation IX LLC, and East Dover Limited is October 5, 2008. The other Petition Dates are as follows: LB 745 LLC (September 16, 2008), PAMI Statler Arms LLC (September 23, 2008), Luxembourg Residential Properties Loan Finance S.a.r.l. (January 7, 2009), BNC Mortgage LLC (January 9, 2009), Structured Asset Securities Corporation (February 9, 2009), LB Rose Ranch LLC (February 9, 2009), and LB 2080 Kalakaua Owners LLC (April 23, 2009).
Gibson, Dunn & Crutcher’s Business Restructuring and Reorganization Practice Group is available to assist in addressing any questions you may have regarding these issues. Please contact the Gibson Dunn attorney with whom you work, or any of the following practice group members:
Michael A. Rosenthal, Co-Chair – New York (212-351-3969, [email protected])
Craig H. Millet, Co-Chair – Orange County (949-451-3986, [email protected])
David M. Feldman, Co-Chair – New York (212-351-2366, [email protected])
Janet M. Weiss – New York (212-351-3988, [email protected])
Matthew J. Williams – New York (212-351-2322, [email protected])
J. Eric Wise – New York (212-351-2620, [email protected])
Oscar Garza – Orange County (949-451-3849, [email protected])
Dennis B. Arnold – Los Angeles (213-229-7864, [email protected])
© 2009 Gibson, Dunn & Crutcher LLP
Attorney Advertising: The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.