Stark Confirms Award of Nunc Pro Tunc Holdbacks by Bankruptcy Court

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The United States Supreme Court, in a 2020 opinion by Curiam, said federal courts can issue nunc pro tunc orders, or “now for then” orders, to reflect the reality of what has already happened. product. “Such a decree presupposes a decree authorized, or ordered, but not recorded, inadvertently by the court.” But the nunc pro tunc orders were not an “Orwellian vehicle for revisionist history”, creating facts that never happened. Roman Catholic Archdiocese of San Juan, Puerto Rico c. Acevedo Feliciano, 140 S.Ct. 696 (2020). Some commentators have seized on the opinion as sounding the death knell for nunc pro tunc orders, particularly in bankruptcy cases where nunc pro tunc retention orders have long been the custom and practice. In Town of Rockford v. Mallinckrodt (In re Mallinckrodt)2022 WL 906451 (D. Del. Mar. 28, 2022), U.S. District Judge Leonard P. Stark found that Acevedo was a narrow decision, limited to its facts, which did not preclude the possibility of nunc pro tunc relief, if any.

Mallinckrodt involved an appeal of a bankruptcy court order approving the debtors’ decision to retain a law firm as special counsel pursuant to 11 USC Section 327(e) nunc pro tunc until ‘on the date of the request. The appellants challenged the sufficiency of the law firm’s disclosures and the nunc pro tunc nature of the remedy, citing Acevedo. Prior to the Chapter 11 cases, the Debtors had engaged the law firm for legal representation on a number of matters, including the defense of a dispute relating to the distribution, pricing and marketing of a drug, Acthar Gel, sued by the appellants.

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