Thank you for sharing!

Your article was successfully shared with the contacts you provided.

Before BAUER, WOOD, and WILLIAMS, Circuit Judges.

This is a bankruptcy case with a complicated factual and procedural background, but one that boils down to a simple question: who breached the parties’ post-petition financing agreement? Arlington Hospitality, Inc. and its subsidiaries (“Arlington”), operators of the AmeriHost hotel chain, filed for Chapter 11 bankruptcy in August 2005. Arlington needed funds in order to meet its obligations during the pendency of the bankruptcy proceeding, and to that end entered into a post-petition financing agreement on the eve of the bankruptcy filing with Arlington LF, LLC (“LF”), a single-purpose entity that had been created for that purpose. LF lent Arlington $3.53 million under the agreement, but shortly thereafter, relations between the parties soured. LF began to have misgivings about its role as a post-petition lender and signaled that it did not wish to make further loans, while Arlington did not pay certain fees associated with the loan. Shortly thereafter, Arlington’s assets were successfully sold in the bankruptcy proceeding, and Arlington repaid LF the full $3.53 million it had borrowed, with interest. LF, believing it was still owed the additional fees Arlington had not paid, filed a motion in the bankruptcy court to recover them, along with additional default interest. Arlington, believing it had met all of its obligations and owed nothing more to LF, opposed the request. The bankruptcy court held a trial on the matter and ruled in Arlington’s favor, concluding that LF had breached the agreement. The district court reversed and remanded, and the bankruptcy court ruled for LF on the second go-round. The district court again reversed, this time on a different basis, with instructions to the bankruptcy court to rule in Arlington’s favor. LF appeals to us. We conclude that LF repudiated the parties’ agreement, and is not entitled to any additional fees or costs. We affirm.

Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.

More From ALM

Premium Subscription

With this subscription you will receive unlimited access to high quality, online, on-demand premium content from well-respected faculty in the legal industry. This is perfect for attorneys licensed in multiple jurisdictions or for attorneys that have fulfilled their CLE requirement but need to access resourceful information for their practice areas.
View Now

Team Accounts

Our Team Account subscription service is for legal teams of four or more attorneys. Each attorney is granted unlimited access to high quality, on-demand premium content from well-respected faculty in the legal industry along with administrative access to easily manage CLE for the entire team.
View Now

Bundle Subscriptions

Gain access to some of the most knowledgeable and experienced attorneys with our 2 bundle options! Our Compliance bundles are curated by CLE Counselors and include current legal topics and challenges within the industry. Our second option allows you to build your bundle and strategically select the content that pertains to your needs. Both options are priced the same.
View Now

General Counsel Conference East 2023

October 03, 2023
Brooklyn, NY

General Counsel Conference addresses trends in regulatory, data protection, tech management, legal operations, and leadership.

Learn More

New York Legal Awards (NYLA) 2023

October 05, 2023
New York, NY

The New York Law Journal honors attorneys and judges who have made a remarkable difference in the legal profession in New York.

Learn More

GlobeSt. NET LEASE Fall 2023

October 16, 2023 - October 17, 2023
Los Angeles, CA

This conference brings together the industry's most influential & knowledgeable real estate executives from the net lease sector.

Learn More

FINANCE & REAL ESTATE ASSOCIATES - Connecticut Preferred; Remote will be considered

Shipman & Goodwin LLP is seeking two associates to expand our national commercial real estate lending practice. Candidates should have ...

Apply Now ›

Labor and Employment Senior Associate or Counsel

Duane Morris LLP seeks a highly motivated senior associate or counsel to join its dynamic and growing Labor and Employment Class Action grou...

Apply Now ›

Labor and Employment Associate

Duane Morris LLP has an immediate opening for a mid-level, highly motivated associate to join its dynamic and growing Employment, Labor, Ben...

Apply Now ›

Chiesa Shahinian & Giantomasi

New Jersey Law Journal


View Announcement ›


New Jersey Law Journal

Riker Danzig deeply mourns the passing of our esteemed partner, dear friend and beloved colleague, Marc D'Angiolillo.

View Announcement ›

Eisenberg, Rothweiler, et.al


Eisenberg Rothweiler

View Announcement ›