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Lowenstein Sandler LLP

Bruce D. Buechler

Bruce D. Buechler

Partner
Vice Chair, Bankruptcy, Financial Reorganization & Creditors' Rights

Expertise

  • Bankruptcy, Financial Reorganization & Creditors’ Rights
  • Bankruptcy, Financial Reorganization & Creditors' Rights

WSG Practice Industries

Activity

WSG Leadership

ABA Group
Member
WSG Coronavirus Task Force Group
Member

Lowenstein Sandler LLP
New Jersey, U.S.A.

Profile

Bruce's tenacity in high-stakes bankruptcy matters has made him a coveted choice for clients seeking high-value results. Bruce draws on his deep understanding of the nuanced complexities of the bankruptcy process and law–and on his keen business sense–to represent clients in bankruptcy, workouts, and other forums. Acting as both business advisor and lawyer, Bruce proactively engages with clients to achieve solutions that align with their business objectives.

In representing business entities such as debtors and creditors' committees in Chapter 11 reorganizations, out-of-court workouts, and other financial reorganizations, Bruce has been involved in numerous complex, high-profile matters. He regularly counsels clients seeking resolution of commercial business disputes and has also successfully litigated numerous commercial disputes in both federal and state courts.

Bruce is recognized as a "smart, efficient, practical and very well prepared lawyer" by Chambers USA (2009-2018). As a noted thought leader, he is regularly called on by publications ranging from Law360 to The Wall Street Journal to comment on topical legal issues. He has also published numerous bankruptcy-related articles.

Bruce has been a member of the Township of West Orange Zoning Board of Adjustment from 1998 to October 2018 and has served as chairperson and vice chair.

Bar Admissions

    New York
    New Jersey

Education

Benjamin N. Cardozo School of Law (J.D. 1987), cum laude
Rutgers, The State University of New Jersey (B.A. 1982), Economics
Areas of Practice

Bankruptcy, Financial Reorganization & Creditors' Rights | Bankruptcy, Financial Reorganization & Creditors’ Rights

Professional Career

Significant Accomplishments

Served as co-lead counsel to the official committee of unsecured creditors in the Orchids Paper Products Company Chapter 11 bankruptcy proceedings in Delaware. Orchids Paper was a leading manufacturer of consumer tissue products. It operated its manufacturing facilities in South Carolina and Oklahoma. Working with the debtors, an auction sale of substantially all of the debtor’s assets substantially increased. A plan of liquidation is pending approval which will result in a distribution to unsecured creditors.

Served as co-lead counsel to the official committee of unsecured creditors in the Chapter 11 cases of ONE Aviation Corporation and its affiliates pending in Delaware. ONE Aviation was a manufacturer of small jets and propeller airplanes. As a result of the sale of the debtors’ assets and successful negotiations with the secured lenders, the debtors’ assets have been sold and a plan of liquidation has been confirmed by the Bankruptcy Court that will result in a distribution to unsecured creditors.

Served as lead counsel for the official committee of unsecured creditors in the Lily Robotics bankruptcy proceeding in Delaware. Lily Robotics was developing and seeking to manufacture a drone camera for commercial and personal use. Prior to filing for bankruptcy, while the Lily drone camera was still in development, Lily presold over 62,000 drone cameras. After litigation with the State of California, the committee, in conjunction with the debtor, filed a plan that resulted in trade creditors receiving a 100% distribution and payment to those customers that preordered a drone in full up to an agreed upon cap.

Served as lead counsel for the official committee of unsecured creditors in the chapter 11 cases of Vitamin World and its affiliates in Delaware. Vitamin World packaged and distributed vitamins, minerals, herbs and various supplements and operated a retail chain of 334 stores selling these products. During the bankruptcy case, the debtors sold a number of their assets and store locations and liquidated the remainder.

Served as lead counsel to the official committee of unsecured creditors in the Horsehead Holding Corp. Chapter 11 bankruptcy cases pending in Delaware. Horsehead is one of the country's leading recyclers of zinc-based and nickel-based products and operates numerous large manufacturing facilities in the United States and Canada. Working with the debtors and the senior secured lenders, the committee negotiated a consensual plan of reorganization that provided for the secured creditors to exchange their debt for equity and provided for a distribution to unsecured creditors in the form of cash for trade creditors and equity or warrants for unsecured noteholders. An equity committee appointed by the bankruptcy court opposed confirmation. After a three-day confirmation trial, during which trial the committee called several witnesses, the bankruptcy court confirmed the plan.

Served as lead counsel for the official committee of unsecured creditors in Draw Another Circle LLC's (also known as Hastings Entertainment) bankruptcy proceeding in Delaware. Hastings Entertainment was a leading multimedia entertainment and lifestyle retailer and operated a 123-store retail chain and an e-commerce website. Affiliated debtor MovieStop was a value retailer of new and used movies and operated through 39 retail locations. Debtor SP Images Inc. was a full-service licensed distributor of sports and entertainment products and apparel.

Served as lead counsel to the official committee of unsecured creditors in the Liberty Medical Chapter 11 bankruptcy cases pending in Delaware. Liberty was a leading mail-order provider of diabetes testing supplies and other medical durable goods, and operated a large mail-order pharmacy. The cases resulted in the sale of the debtor's assets and confirmation of a plan of liquidation that resulted in a 100% distribution for unsecured creditors plus post-petition interest. The success led to top honors by the M&A Advisor Turnaround Awards as Restructuring of the Year 2014.

Served as lead counsel for the official committee of unsecured creditors in the Source Home Entertainment Chapter 11 bankruptcy cases pending in Delaware. Source was one of the nation's leading distributors of magazines and manufacturer of retail wire display units. Successfully negotiated a settlement with the secured lenders that resulted in the confirmation of a plan of liquidation and a distribution to unsecured creditors.

Served as lead counsel for the official committee of unsecured creditors in the Borders Group Chapter 11 bankruptcy case pending in New York. Borders, a national book retailer, went through one of the largest Chapter 11 cases filed in the United States in 2011. Once the plan of liquidation was confirmed, continued to act as lead counsel to the liquidating trust established to wind down Borders. Successfully argued two appeals in the Borders case before the U.S. Court of Appeals for the Second Circuit.

Served as lead counsel to the official committee of unsecured creditors in the Chapter 11 case pending in New York of The Connaught Group, a direct marketing retailer of high-end women's clothing. Company was successfully sold.

Served as lead counsel to RoomStore Inc., a publicly held company, in its Chapter 11 filing in the Bankruptcy Court for the Eastern District of Virginia. Shepherded the company, a retail furniture chain, through an orderly liquidation of its retail stores and other assets.

Served as lead counsel to the official committee of unsecured creditors in the Chapter 11 case pending in Delaware of Nebraska Book Company, which was the third largest operator of college bookstores in the United States.

Served as lead counsel to the official committee of unsecured creditors in the Chapter 11 bankruptcy case pending in Delaware of Parking Company Airports America and its affiliates. The company was one of the largest owners/operators of parking lots adjacent to airports in the United States. Successfully negotiated a resolution for the committee in connection with the proposed sale of substantially all of the debtors' assets, which resulted in a substantial distribution to unsecured creditors.

Served as lead counsel to the creditors' committee in the White Energy Chapter 11 bankruptcy case in the Bankruptcy Court for the District of Delaware. White Energy operated three ethanol plants located in the Midwest. As a result of the committee's efforts, a successful plan was consummated that permitted the secured lenders to take ownership of White Energy and provided for a distribution to unsecured creditors.

Served as lead counsel to U.S. Mortgage Corp. and its affiliated entity in their Chapter 11 filings in New Jersey. U.S. Mortgage was the victim of fraud by its president and controlling shareholder. Debtors were successfully liquidated, thousands of mortgages transferred to third parties, and no individual consumer suffered any losses as a result of the former principal's fraud, which included the theft of approximately $140 million.

Published Opinions

In re Veg Liquidation, Inc., 931 F.3d 730 (8th Cir. 2019), cert. denied, __ U.S. __ (January 13, 2020); 583 B.R. 203 (8th Cir. B.A.P. 2008)

In re BGI, Inc., 772 F. 3d 102 (2d Cir. 2014), cert. denied, __ U.S. __, 193 L.Ed.2d 44 (October 5, 2015)

In re BGI, Inc., 504 B.R. 754 (S.D.N.Y. 2014), aff’d, 595 Fed. Appx. 86 (2d Cir. 2015)

In re BGI, Inc., 2013 U.S. Dist. LEXIS 77740 (S.D.N.Y. 2013) In re Madoff, 496 B.R. 744 (Bankr. S.D.N.Y. 2013) In re The Connaught Group, Ltd., 491 B.R. 88 (Bankr. S.D.N.Y. 2013) In re BGI, Inc., 476 B.R. 812 (Bankr. S.D.N.Y. 2012) In re RoomStore, Inc., 473 B.R. 107 (Bankr. E.D.Va. 2012) In re Monroe Center, LLC, 2012 Bankr. LEXIS 1606 (Bankr. D.N.J. 2012) In re Borders Group, Inc., 462 B.R. 48, 462 B.R. 42, 460 B.R. 818, 453 B.R. 477, 453 B.R. 459 (Bankr. S.D.N.Y. 2011) Liberty Mutual Insurance Co. v. Citron, 2011 Bankr. LEXIS 3934 (Bankr. E.D.N.Y. 2011) In re Milford Connecticut Associates, L.P., 404 B.R. 699 (D. Conn. 2009)

In re Jack C. Benun, 386 B.R. 59 (Bankr. D.N.J. 2008), aff’d in part and vacated in part, 2008 U.S. Dist. LEXIS 97524 (D.N.J. Dec. 1, 2008), aff’d, 382 Fed. Appx. 659 (Fed. Cir. 2009)

In re Dunmore Homes, Inc., 380 B.R. 663 (Bankr. S.D.N.Y. 2008) In re EnCap Golf Holdings, 2008 Bankr. LEXIS 2146 (Bankr. D.N.J. 2008) In re Summit Global Logistics, Inc., 2008 Bankr. LEXIS 896 (Bankr. D.N.J. 2008) In re Comfort Co., Inc., 2008 Bankr. LEXIS 4790 (Bankr. D. Del. 2008) In re Allserve Systems Corp., 379 B.R. 69 (Bankr. D.N.J. 2007)

Doubet, LLC v. Palermo, 370 B.R. 599 (Bankr. S.D.N.Y. 2007), 2007 Bankr. LEXIS 4195 (Bankr. S.D.N.Y. Dec. 3, 2007)

In re American Pad & Paper Company, 478 F.3d 546 (3rd Cir. 2007) In re Advanced Marketing Services, Inc., 360 B.R. 421 (Bankr. D. Del. 2007) In re KI Liquidation, Inc., 2007 Bankr. LEXIS 5019 (Bankr. D.N.J. 2007) Mercury Capital Corporation v. Milford Connecticut Associates, L.P., 354 B.R. 1 (D. Conn. 2006) In re Jack C. Benun, 339 B.R. 115 (Bankr. D.N.J. 2006) In re WorldCom, Inc., 322 B.R. 530 (Bankr. S.D.N.Y. 2005) In re Jazz Photo Corp., 312 B.R. 524 (Bankr. D.N.J. 2004) In re The Muralo Company, Inc., 301 B.R. 690 (Bankr. D.N.J. 2003)  In re Telephone Warehouse, Inc., 259 B.R. 64 (Bankr. D. Del. 2001) In re Telegroup, Inc., 237 B.R. 87 (Bankr. D.N.J. 1999) WorldCom, Inc. v. Sandoval, 701 N.Y.S. 2d 834 (N.Y. Sup. Ct. 1999) In re Docteroff, 133 F.3d 210 (3rd Cir. 1997) In re Kingston Square Associates, 214 B.R. 713 (Bankr. S.D.N.Y. 1997) In re Lan Associates XIV, L.P., 193 B.R. 730 (Bankr. D.N.J. 1996) In re Kaplan, 186 B.R. 871 (Bankr. D.N.J. 1995) In re Mocco, 176 B.R. 335 (Bankr. D.N.J. 1995)

Ilan-Gat Engineers, Ltd. v. Shelter Systems Corp., 879 F. Supp. 416 (D.N.J. 1994)

State of New Jersey v. Heldor Industries, Inc., 989 F.2d 702 (3rd Cir. 1993) In re Madison Industries, Inc., 161 B.R. 363 (D.N.J. 1993) In re Heldor Industries, Inc., 139 B.R. 290 (D.N.J. 1992), 131 B.R. 578 (Bankr. D.N.J. 1991) In re Manner Place Development Associates, L.P., 144 B.R. 679 (Bankr. D.N.J. 1992) Russo v. Friedman, 1992 U.S. Dist. LEXIS 11418 (S.D.N.Y. 1992) First Jersey National Bank v. Brown, 951 F.2d 564 (3rd Cir. 1991), 127 B.R. 108 (D.N.J. 1991), 916 F.2d 120 (3rd Cir. 1990) In re Rubin Bros. Footwear, Inc., 119 B.R. 416 (S.D.N.Y. 1990) In re Neptune Worldwide Moving, Inc., 111 B.R. 457 (Bankr. S.D.N.Y. 1990), 99 B.R. 584 (Bankr. S.D.N.Y. 1989) Ingersoll-Rand Financial Corp. v. Atlantic Management & Consulting Corp., 717 F. Supp. 1076 (D.N.J. 1989)

Professional Associations

American Bankruptcy InstituteMember, West Orange Zoning Board of Adjustment (1998-2018)


Professional Activities and Experience

Accolades
  • Chambers USA: America's Leading Lawyers for Business - (2009-2020) Bruce Buechler
  • The Best Lawyers in America - (2013-2020) Bruce Buechler
  • Super Lawyers (2005-2020) Bruce Buechler
  • Turnaround Awards - The M and A Advisor - 2014 Bruce Buechler
  • Equal Justice Award - Legal Services of New Jersey - 2006 Bruce Buechler

Articles

When Financial Stress Turns to Distress–Restructuring Tools to Avoid Disaster Parts 1 and 2: Chapter 11 Checklist and What Else Is in the Toolbox
Lowenstein Sandler LLP, April 2020

When Financial Stress Turns to Distress–Restructuring Tools to Avoid Disaster Parts 1 and 2: Chapter 11 Checklist and What Else Is in the Toolbox In this Client Alert series, Lowenstein’s Bankruptcy, Financial Reorganization & Creditors’ Rights Department will introduce the various restructuring tools available to help businesses avoid financial catastrophe in the current environment...

Receipt of Goods Means Physical Possession in Determining Whether a Trade Vendor Has a Section 503(b)(9) Claim
Lowenstein Sandler LLP, July 2017

A recent decision by the United States Court of Appeals for the Third Circuit in In re World Imports, Ltd. ruled on a hotly contested issue of bankruptcy law that has significant ramifications for trade creditors selling goods to a debtor just prior to the debtor filing for bankruptcy...

Pursuing Avoidance Power Claims Against Foreign Entities
Lowenstein Sandler LLP, July 2017

A recent decision by the Delaware Bankruptcy Court, in In re FAH Liquidating Corp., addressed the issue of whether a transfer of a debtor’s assets that occurred outside of the United States can be avoided and recovered under the Bankruptcy Code. The Bankruptcy Court held that a trustee or debtor-in-possession can avoid and recover fraudulent conveyances (and, by extension, preferential transfers) that occurred outside of the U.S...

Additional Articles

Reorganizing Failing Businesses, Third Edition, is the culmination of more than two decades of work by dozens of experts in bankruptcy, insolvency, and myriad other areas of law that impact the restructuring of a troubled business. Revised and expanded, this valuable, two-volume, desk reference presents the totality of the restructuring process as it is practiced today, with detailed explanations of the laws, customs, and techniques that are central to restructurings. This comprehensive treatise covers in-depth treatment of chapter 11 reorganizations; out-of-court restructurings; specialized restructuring situations (such as prepackaged plans, transnational restructurings and cross-border insolvencies, mass tort cases, and airline cases); and the implications of related areas of law, including taxation, securities, environmental, intellectual property, labor and employment, lender liability, criminal, financial market, and competition law.

A recent decision by the Delaware Bankruptcy Court, in In re FAH Liquidating Corp., addressed the issue of whether a transfer of a debtor’s assets that occurred outside of the United States can be avoided and recovered under the Bankruptcy Code. The Bankruptcy Court held that a trustee or debtor-in-possession can avoid and recover fraudulent conveyances (and, by extension, preferential transfers) that occurred outside of the U.S., following decisions by the Bankruptcy Court for the Southern District of New York and the U.S. Fourth Circuit Court of Appeals.

In Cooling Guard Mechanical Corp. v. Frankl, No. BER-C-119-17 (N.J. Super. Ct. Ch. Div. Aug. 21, 2017), the New Jersey Superior Court decided an issue of first impression under New Jersey law: whether a creditor must have been a creditor at the time of an alleged transfer in order to subsequently avoid the transfer as an actual fraudulent conveyance. The court held in the affirmative. Because the plaintiffs were not creditors at the time of the alleged transfer, the court dismissed the complaint.


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In a decision that will likely resonate with anyone who's ever had a joint bank account, or with creditors who have had to deal with them, the New Jersey Appellate Division recently confirmed that a judgment creditor of one spouse cannot successfully levy upon a joint bank account of a married couple unless the judgment creditor demonstrates that the funds in the joint account are the individual property of the judgment debtor.


In Banc of America Leasing and Capital v. Fletcher-Thompson, a judgment debtor maintained a joint account with his wife, who was not a defendant. Banc of America Leasing and Capital obtained a default judgment in the State of Michigan against the husband, another individual, and a corporation. Banc of America Leasing domesticated and registered its Michigan judgment in New Jersey and obtained a writ of execution for a bank levy by the sheriff, which was served on a bank. The bank froze funds in the couple's joint account.


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A recent decision by the New Jersey Appellate Division held that N.J.S.A. 46:3-17.4 “precludes a spouse’s unsecured creditor from obtaining the forced partition of real property the spouse and his non-debtor spouse own together as tenants by the entirety.”[1] This decision in Jimenez v. Jimenez reiterates that the purpose of N.J.S.A. 46:3-17.4 was to modify New Jersey common law to now prohibit a creditor of one spouse from executing on either real or personal property owned by both spouses as tenants by the entirety.


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The following is a familiar fact pattern for those involved in real estate. A borrower defaults under a mortgage and note. The lender commences a foreclosure action. Once a final judgment of foreclosure is entered, a writ of execution is issued, and the sheriff schedules a sale to sell the real property. Either before or the day of the foreclosure sale, or within the borrower’s time period to exercise its right of redemption of equity, the borrower files for bankruptcy under Chapter 7 or 11 in an attempt to obtain more time to sell the property. Ultimately, the real property is sold pursuant to a bankruptcy court sale process, usually pursuant to section 363 of the Bankruptcy Code. The sheriff then seeks a commission in connection with the bankruptcy court sale of the real property. Question: is the sheriff entitled to a commission?


Today, due to tight budgets and limited revenue sources, one can expect to see the sheriff (and other governmental entities) seeking to more actively exercise their alleged rights in bankruptcy in order to collect revenue. While the fact pattern described above is simple and occurs with some frequency, the sheriff’s entitlement to a commission, if any, is primarily based on the applicable state law where the foreclosure sale was pending. If the sheriff does not actually sell the real property, (i) in certain states, such as Georgia, North Dakota and Virginia, the sheriff would not be entitled to any commission; (ii) in certain states, such as Colorado and Idaho, applicable state law entitles a sheriff to a fixed commission; (iii) in some states, nothing; and (iv) in certain states, such as New Jersey, New York, Hawaii and West Virginia, the statute is ambiguous and courts are split as to the sheriff’s entitlement to a commission and, if so, how much.

In a Chapter 11 case, the creditors’ committee is given broad powers to oversee and investigate the past and current business of the debtor (§ 1102, Bankruptcy Code). The committee can make document requests, speak with the debtor’s employees, depose the debtor’s management and board of directors, subpoena records, and generally use any appropriate form of discovery for its inquiry.


It is key for the creditors’ committee to understand the true causes of the debtor’s Chapter 11 filing and how or if the debtor’s problems can be fixed by use of the Chapter 11 process to maximize recovery for unsecured creditors. In addition to understanding how Chapter 11 can be used to preserve, restore, or increase a company’s value, creditors’ committees must also investigate and understand the debtor’s prepetition business and the financial issues confronting the debtor that led to the debtor’s distress.


Few debtors accept blame for the mistakes, lack of vision, or failure of management or the board of directors to act in a timely manner. Therefore, committee counsel must ascertain the root cause of the debtor’s financial failure and ensure that the debtor is taking the necessary steps to effectively rehabilitate itself before the company’s going concern value dissipates and liquidation become inevitable.


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