The Fourth Circuit’s recent unpublished opinion in Front Row Motorsports v. DiSeveria is, on the surface, a straightforward contract dispute arising from an indemnity agreement. But behind the curtain of corporate formalities is the long shadow of In re BK Racing, the bankruptcy case that has become the NASCAR equivalent of a Russian nesting doll—each layer revealing deeper dysfunction.
This long-running asbestos bankruptcy saga involving Kaiser Gypsum and its affiliate Hanson Permanente Cement returned to the Fourth Circuit following a Supreme Court remand, which held that Truck Insurance Exchange ("Truck") qualified as a “party in interest” under § 1109(b) of the Bankruptcy Code. This opened the door for Truck to assert objections to the proposed § 524(g) reorganization plan, which had previously been rebuffed for lack of standing.
In Sugar & Sasser v. Burnett, the Fourth Circuit upheld in part and vacated in part a district court’s affirmance of the bankruptcy court’s sanctions arising from a Chapter 13 debtor’s unauthorized sale of her residence. The debtor, Christine Sugar, sold her home during the pendency of her case without prior court approval as required by Eastern District of North Carolina Local Bankruptcy Rule 4002-1(g)(4) and her confirmed Chapter 13 plan, even though the property was partially exempt
