The Togut Firm represents post-confirmation debtors Aurora Commercial Corp. and Aurora Loan Services, LLC, two subsidiaries of Lehman Brothers Holdings Inc. that engaged in the origination and servicing of residential mortgage loans, in connection with their chapter 11 wind-down and liquidation. Pre-confirmation, the debtors succeeded in reducing the their claims pool, which was composed largely of litigation claims arising from disputed foreclosures, from approximately $343 million to $55,000. A number of litigation claimants appealed the orders disallowing their claims, which have worked their way through the appellate courts following confirmation of the debtor’s chapter 11 plan in May 2020.
This week, Judge Ramos for the SDNY District Court issued an opinion in the appeal Pierre v. Aurora Commercial Corp. affirming the Bankruptcy Court’s disallowance of the appellant’s second proof of claim, which asserted damages arising from the foreclosure of his home. This is the fifth and final opinion of the District Court affirming the disallowance of claims, following opinions issued by Judge Abrams (Horner v. Aurora Com. Corp., 2021 WL 1222148 (S.D.N.Y. Mar. 31, 2021)), Judge Oetken (Smith v. Aurora Com. Corp., 2020 WL 7028956 (S.D.N.Y. Nov. 30, 2020)), and Judge Koeltl (Czin v. Aurora Com. Corp., 2021 WL 1634693 (S.D.N.Y. Apr. 26, 2021) and Pierre v. Aurora Com. Corp., 620 B.R. 210 (S.D.N.Y. 2020)). One appeal remains pending in the Second Circuit.
On March 24, 2019, Aurora Commercial Corp. and Aurora Loan Services filed for chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York. On May 28, 2020, the Bankruptcy Court confirmed a chapter 11 plan for the debtors. At the confirmation hearing, Judge Chapman for the Bankruptcy Court noted that the Togut Firm “has managed to deliver a spectacular result for these estates through a lot of hard work, and hard work that I would also note is done in an efficient and professional manner.”