United States District Court, D. New Jersey
In re REVEL AC, INC., et al., Debtors.
REVEL AC, INC., Appellee. ACR ENERGY PARTNERS, LLC, Appellant, AMERICAN CUT AC MARC FORGIONE, LLC, AZURE AC ALLEGRETTI, LLC, GRGAC1, LLC, GRGAC2, LLC, GRGAC3, LLC, LUGO AC, LLC, MUSSEL BAR AC, LLC, PM ATLANTIC CITY, LLC, RJ ATLANTIC CITY, LLC, and THE MARSHALL RETAIL GROUP, LLC, Appellants,
REVEL AC, INC., Appellee.
Stuart M. Brown, Esq., Timothy J. Lowry, Esq., R. Craig Martin, Esq., DLA PIPER LLP (US), Atlantic City, N.J., Attorneys for ACR Energy Partners, LLC.
Warren J. Martin, Jr., Esq., Robert M. Schechter, Esq., Rachel A. Parisi, Esq., PORZIO, BROMBERG & NEWMAN, P.C., Morristown, N.J., Attorneys for American Cut AC Marc Forgione, LLC, Azure AC Allegretti, LLC, GRGAC1, LLC, GRGAC2, LLC, GRGAC3, LLC, Lugo AC, LLC, Mussel Bar AC, LLC, PM Atlantic City, LLC, RJ Atlantic City, LLC, and The Marshall Retail Group, LLC.
Michael J. Viscount, Jr., Esq., John H. Strock, Esq., FOX ROTHSCHILD LLP, Atlantic City, N.J., and John K. Cunningham, Esq., Jason N. Zakia, Esq., WHITE & CASE LLP, Miami, Fla., Attorneys for Revel AC, Inc.
Stuart J. Moskovitz, Esq., Freehold, N.J., Attorney for Awardee Polo North County Club, Inc.
ON APPEALS FROM AN ORDER OF THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF NEW JERSEY OPINION
JEROME B. SIMANDLE, Chief District Judge.
These matters arise out of the chapter 11 proceedings of the beleaguered and now defunct Revel Casino, a $2.4 billion casino property in Atlantic City, New Jersey that ceased its operations on September 2, 2014. In the pending appeals, Appellants ACR Energy Partners, LLC (hereinafter, "ACR") and American Cut AC Marc Forgione, LLC's, et al. (hereinafter, the "Amenity Tenants" and collectively, "Appellants"), challenge the Bankruptcy Court's January 8, 2015 Order approving the sale and purchase of the assets of Revel AC, Inc., et al. (hereinafter, the "Appellees, " "Debtors, " or "Revel"), free and clear of liens, claims, and encumbrances pursuant to 11 U.S.C. § 363(f) (hereinafter, the "Sale Order"), on the basis that the Sale Order improperly dispossessed Appellants of their possessory leasehold interests under 11 U.S.C. § 365(h), and approved a sale free and clear without adequately protecting the Appellants' interests under 11 U.S.C. §§ 363(e), and in the absence of any bona fide dispute under 11 U.S.C. § 365(f)(4).
ACR and the Amenity Tenants were among four groups of appellants which moved,  on an emergent basis, to stay paragraph 14 of the Sale Order, the provision enabling the Revel assets to be sold free and clear of Appellants' interests, pending appeal, in order to prevent the purportedly irrevocable dispossession of their contracted for property interests, claims, and/or liens, and to prevent a consummated sale under the Sale Order from rendering their claims on appeal statutorily moot under 11 U.S.C. § 363(m). Following expedited briefing, and a lengthy hearing,  the Court denied all appellants' motions to stay the sale pending appeal on January 21, 2015. See In re Revel AC, Inc., ___ B.R. ___, Nos. 15-299, 15-302, 15-317, 15-352, 2015 WL 268816 (D.N.J. Jan. 21, 2015).
Meanwhile, the appellant in IDEA Boardwalk, LLC v. Revel AC, Inc., Civil Action No. 15-299 (JBS), a related appeal addressed in the Court's decision, was the sole party which filed a timely notice of appeal to the Court of Appeals on January 28, 2015, and subsequently filed an emergency motion to stay and/or for an expedited appeal before the Court of Appeals. In a 2-1 Order dated February 6, 2015, the Court of Appeals reversed this Court's denial of a stay as to IDEA Boardwalk, LLC (hereinafter, "IDEA") for reasons to follow in a forthcoming Opinion, and directed that paragraph 14 of the Sale Order be stayed to the extent it pertained to IDEA pending this Court's disposition of IDEA's appeal. [See Order dated February 6, 2015 in App. No. 15-1253.] The Court of Appeals noted, however, that its Order affected no other provision of the Sale Order, and that the sale therefore remained "free to go forward in all other respects." [See id.]
ACR and the Amenity Tenants now move, on an emergent basis, for reconsideration of, and/or relief from, the Court's January 21, 2015 decision which had denied a stay, arguing, in essence, that the Court of Appeals' February 6, 2015 Order reversing this Court's January 21, 2015 denial of Appellant IDEA Boardwalk, LLC's (hereinafter, "IDEA Boardwalk") motion to stay pending appeal in IDEA Boardwalk, LLC v. Revel AC, Inc., Civil Action No. 15-299 (JBS), fundamentally called into question this Court's January 21, 2015 ruling as to ACR and the Amenity Tenants. (See generally ACR's Br. at 5-11; Amenity Tenants' Br. at 7-8.) In so arguing, ACR and the Amenity Tenants submit that the Court of Appeals' Order in reversing this Court's denial of stay pending appeal applies with equal force and effect to them, because their appeals rely upon a similar, if not identical, legal and factual predicate, and because this Court denied Appellants' initial motions to stay for much the same reasons it denied IDEA's motion. (See generally ACR's Br. at 5, 7; Amenity Tenants' Br. at 7-8.) Given these procedural circumstances, ACR and the Amenity Tenants argue that a stay pending appeal should, in equity, be granted as to ACR and the Amenity Tenants.
The Court has considered the parties' submissions and arguments at an expedited hearing on February 9, 2015.
For the reasons that follow, the Court will grant Appellants' motions in part, and will stay paragraph 14 of the Sale Order to the extent it pertains to ACR and the Amenity Tenants, pending the Court's determination of the pending appeals of ACR, the Amenity Tenants, and IDEA Boardwalk, and the remainder of the Sale Order is unaffected and the sale may go forward.
A. Factual and Procedural ...