In re: A & F Enterprises, Inc. II

Federal 7th Circuit Court
Civil Court
Case Number: 
No. 13-3192
Decision Date: 
February 7, 2014
Federal District: 
N.D. Ill., E. Div.
Motion for stay of Bankruptcy Ct. order pending appeal granted
Debtor in instant Chapter 11 proceeding was entitled to stay of Bankruptcy Ct. order that found that debtor’s failure to assume building leases that housed debtor’s franchise restaurants within applicable six-month limitations period under 11 USC section 365(d)(4) also meant that debtor’s franchise agreement had expired. Debtor argued that longer limitation period for assuming leases applied where leases were tied to franchise agreements, and that it was entitled to stay where it would have no way to recover franchises once they had been terminated, even if it were to prevail on appeal. As such, stay was appropriate because debtor’s loss was significantly greater if stay were not imposed than any loss to franchisor if stay were imposed.