CenterPoint Properties Trust

• Client: CenterPoint Properties Trust
• Date: 2001-2003
• Location: Chicago and Delaware

Summary:

Schiff Hardin represented CenterPoint Properties Trust in two cases that not only recovered millions of dollars of rent, but yielded recoveries in excess of that paid to other unsecured creditors and made new law favorable to commercial landlords.

In In re Montgomery Ward Holding Corp., we appealed adverse rulings of the bankruptcy court and district court of Delaware and persuaded the Third Circuit to recognize that real estate tax pass-throughs billed in arrears during the bankruptcy should be given administrative expense priority even though they accrued pre-petition and the lease was rejected. This result not only defeated the landlord's privity claims for all such pass-throughs; it changed the behavior of debtors in this crucial venue to make prompter assumption/rejection decisions.

In Ha-Lo Industries, Inc. v. CenterPoint Properties Trust, we counseled CenterPoint regarding the rejection of its lease of a large single-tenant office building and, in litigation in the U.S. Court of Appeals for the Seventh Circuit, successfully distinguished prior cases so that CenterPoint received a full month's rent because the lease was rejected mid-month. This again boosted CenterPoint's priority claim by more than $1 million.

We also advised CenterPoint in its capacity as chair of the creditors' committee regarding litigation against officers, directors and insurance carriers of the debtor.

Finally, after receiving a multi-million dollar interim distribution, we assisted CenterPoint in conducting an auction of its claim to receive millions more from a hedge fund while retaining a share of the upside in the event that litigation against the debtor's financial advisor succeeded.

In re Montgomery Ward Holding Corp., 268 F.3d 205 (3d Cir. 2001)
Ha-Lo Industries, Inc. v. CenterPoint Properties Trust, 342 F.3d 794 (7th Cir. 2003)