Okin & Adams Assists Creditors’ Committee in Confirmation of Black Elk Bankruptcy Plan
Okin & Adams LLP recently completed its representation of the Official Committee of Unsecured Creditors in the Chapter 11 bankruptcy of Black Elk Energy Offshore Operations, LLC. Okin Adams, on behalf of The Grand Ltd., Gulf Offshore Logistics LLC, Ryan Marine Services, Inc., and Laredo Construction Inc, initially filed an involuntary Chapter 7 bankruptcy almost one year ago in an effort to halt the continued deterioration of the company’s financial state and preserve various claims and causes of action for the benefit of Black Elk’s creditors. The company ultimately consented to the bankruptcy and the case was converted to a Chapter 11 case by agreement. Following conversion to Chapter 11, Okin Adams was selected to represent the Official Committee of Unsecured Creditors. Notwithstanding significant claims from the company’s noteholders, working interest partners, the US Department of Justice and the US Department of the Interior, the Creditors’ Committee was able to negotiate plan treatment that provides for a potential recovery to unsecured creditors.
The liquidation plan, first filed on April 12, 2016, provides for creditor recoveries that are largely contingent on potential litigation claims. Prior to bankruptcy, Black Elk had already sold most of its assets and distributed the proceeds to certain creditors and insiders.The plan provides for the creation of both a liquidation and a litigation trust to fund creditor recoveries. The plan assigned potential causes of action, including potential claims against Black Elk’s majority owner, Platinum Partners, to the litigation trust. The Plan also incorporated a substantial settlement of an alleged DOI administrative claim of more than USD 660.6m,related to the company’s P&A obligations. The Debtor and the Creditors’ Committee negotiated a P&A plan that reduced its P&A obligations to almost zero.
The Bankruptcy Court for the Southern District of Texas confirmed the plan on July 14, 2016. The plan became effective on July 25, 2016.
Okin Adams representation of the Creditors’ Committee was headed by lead-attorney, Matthew Okin, with substantial assistance from David Curry. Brian Roman, JT Oldham and George Nino from Okin Adams provided additional assistance in the investigation and development of the litigation claims against Platinum and other parties.