In a 10 page opinion released January 5, 2016 in the Tropicana
Entertainment bankruptcy (Bank. D. Del. 08-10856), Judge Carey of
the Delaware Bankruptcy Court provided a critical opinion
concerning the handling of a dispute arising from two
debtors’ division of professional payments. Judge Carey’s opinion is available here (the
"Opinion").
Background
In May of 2009 both the OpCo and LandCo debtors in the Tropicana
bankruptcy had their plans confirmed. The plans became effective
June 30, 2009. The two entities cases were procedurally
consolidated, but not substantively consolidated. Because they were
unable to reach an agreement on the issue it became necessary for
the Court to decide what percentage of professional fees should be
charged to each estate. In his Allocation Decision, Judge Carey
determined that “professional fees incurred through June 30,
2009 should be allocated 75% to the OpCo Debtors and 25% to the
LandCo Debtors.” Opinion at *2. As the bankruptcy
