Opinion ID: 205909
Heading Depth: 3
Heading Rank: 2

Heading: The First District Court Ruling

Text: LF appealed the bankruptcy judge’s ruling to the district court. The district court disagreed with the bankruptcy court’s conclusion that all fees related to the DIP lending were only payable on invoice from LF, noting the separate paragraph in the Interim Order specifying that the Commitment and Funding Fees were payable immediately instead. The district court reasoned that Arlington, having failed to pay the fees that were due immediately upon entry of the Order on September 2, was therefore already in default by the time LF purportedly repudiated on September 29. And if Arlington was already in default as of that time, it No. 09-3560 11 could not claim that LF had breached. The district court vacated the bankruptcy court’s decision and remanded the matter for further proceedings. Critically, neither party raised, nor did the district court address, the fact that the Interim Order had a Notice Provision (described infra) whereby Arlington could only actually be in a cognizable breach after having been given notice and an opportunity to cure.