In a published decision from the General Motors bankruptcy case, the U.S. Bankruptcy Court for the Southern District of New York held that a creditor holding a contingent, unsecured claim that received proper notice of the claims bar date did not establish “excusable neglect” to permit it to file a proof of claim some nine years after the bar date passed. The court found that the movant, a large, public company with tens of thousands of employees, was a “sophisticated” creditor, and that its sophistication was “further proof” that its failure to file a timely claim did not constitute excusable neglect, see In re Motors Liquidation, 598 B.R. 744 (Bankr. S.D.N.Y.  2019).

Background

In 1994, General Motors Corp. (Old GM) sold to American Axle & Manufacturing, Inc. (American Axle) certain real property located in New York that had been contaminated with hazardous chemicals (the site). American Axle had been aware of the environmental contamination since acquiring the site. Among other things, Old GM had disclosed the environmental contamination to American Axle in connection with the sale and, in 2002 and 2003, both American Axle and Old GM participated in proceedings before the state environmental department related to contamination at the site. A third party eventually acquired the site from American Axle.