MOAC Mall Holdings LLC v. Transform Holdco LLC
Issues
Does Bankruptcy Code § 363(m) limit federal appellate courts’ jurisdiction to conduct judicial review, even when there is an opportunity for a judicial remedy that would not affect the validity of a sale in a bankruptcy proceeding?
This case asks the Supreme Court to determine whether a provision of federal bankruptcy law, 11 U.S.C. § 363(m), restricts the power of federal courts to review the order approving the sale of Sears’ assets. In the wake of Sears’ bankruptcy filing, Sears’ former CEO created a company, Transform HoldCo. Transform HoldCo then acquired Sears’ lease for space located in the Mall of America and subsequently assigned that lease to one of its subsidiaries with approval from the Bankruptcy Court. MOAC Mall Holdings, which owns Mall of America, challenged the assignment in federal court. Transform HoldCo contends that federal courts do not have the ability to review the decision of the Bankruptcy Court, and that regardless, the relief that MOAC seeks is unavailable because under no circumstances can MOAC retake control of the lease. MOAC contends both that the assignment decision is indeed reviewable by federal courts and also that it is entitled to relief under the relevant statutes. This case has important implications for judicial review and for the protections that mall owners and good-faith transferees have during bankruptcy proceedings.
Questions as Framed for the Court by the Parties
Whether Bankruptcy Code Section 363(m) limits the appellate courts’ jurisdiction over any sale order or order deemed “integral” to a sale order, such that it is not subject to waiver, and even when a remedy could be fashioned that does not affect the validity of the sale.
MOAC Mall Holdings LLC, or Mall of America (“MOAC”), owns and operates the nation’s largest shopping mall in Bloomington, Minnesota. Brief for Petitioner, MOAC Mall Holdings LLC (“MOAC”) at 6.
The authors would like to thank Professor Brian M. Richardson for his guidance and insights into the case.
Additional Resources
- Daniel Gill, Justices Take on Mall of America-Sears Row in Bankruptcy Case (1), Bloomberg Law (June 27, 2022).
- Brian Hockett, Katie Kraft, Douglas Lang, & David Warfield, Bankruptcy Code § 363(m) is Now Up for Interpretation at the U.S. Supreme Court, JD Supra (Aug. 4, 2022).
- Dietrich Knauth, U.S. Supreme Court Takes Dispute over Extremely Cheap Mall Lease, Reuters (June 27, 2022).