Court unanimously upheld a secured creditor’s right to credit bid in bankruptcy cases.

In the recently released decision by  the U.S. Supreme Court in RadLAX Gateway Hotel, et al. v. Amalgamated Bank, 566 U.S.___ (2012), the Court unanimously upheld a secured creditor’s right to credit bid in bankruptcy cases.  The Court rejected the "indubitable equivalent" argument followed by the 3rd Circuit in Philadelphia Newspapers and specifically affirmed lower court rulings from other Circuits that bidding procedures allowing only cash, not credit, bids were impermissible.  RadLAX  restores certainty to this area, particularly for secured creditors, as it insures that secured creditors will be allowed to offset what is owed through a credit bid towards debtor property offered for sale.   You can read the decision at http://www.supremecourt.gov/opinions/11pdf/11-166.pdf