In re Consolidated Land Holdings, LLC, Debtor., 2021 Bankr. LEXIS 2270

Summary

HOLDINGS: [1]-Debtors' joint plan did not comply with 11 U.S.C.S. § 1122 as it improperly gerrymandered the secured creditor's claims into a separate class and provided unjustified disparate treatment to buy the secured creditor's support. There was no reason for unsecured creditors of equal priority to receive disproportionately different portions and if the secured creditor's claims were classified with the other unsecured claims, the joint plan would not have an accepting impaired class as required by 11 U.S.C.S. § 1129(a)(1); [2]-Court agreed with the per debtor approach to the impaired accepting class rule; debtors were not substantively consolidated, and absent this, § 1129(a) had to be satisfied by each debtor. As the secured creditor was not a creditor of one of the debtors, the joint plan had not been accepted by an impaired class for each debtor as required by § 1129(a)(10).