Proposed Order Approving Second Stipulation To Extend

Summary

A certification of counsel filed May 8, 2023 as Doc 806 by the United States in In re Kabbage, Inc. d/b/a KServicing, et al., Case No. 22-10951 (CTG), in the U.S. Bankruptcy Court for the District of Delaware. It submits a proposed order approving a second stipulation with the Debtors to extend the United States' deadline to file a complaint to determine dischargeability of debt under 11 U.S.C. § 523(c). The certification recounts that the deadline was January 9, 2023, that an earlier order extended it to May 9, 2023 [Docket No. 429], and that the Plan was confirmed on March 15, 2023 [Docket No. 680]. It seeks an extension through and including August 7, 2023 because the Plan's effective date is projected to occur after the current deadline. The stipulation is Exhibit 1 to the proposed order, which is attached as Exhibit A.

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                Case 22-10951-CTG              Doc 806       Filed 05/08/23         Page 1 of 4




                       IN THE UNITED STATES BANKRUPTCY COURT
                            FOR THE DISTRICT OF DELAWARE




 In re:
                                                                Chapter 11
 KABBAGE, INC. d/b/a KSERVICING, et al., 1
                                                                Case No. 22-10951 (CTG)
                   Debtors.
                                                                (Jointly Administered)



                   CERTIFICATION OF COUNSEL SUBMITTING
          PROPOSED ORDER APPROVING SECOND STIPULATION TO EXTEND
              THE UNITED STATES’ DEADLINE TO FILE A COMPLAINT
                  TO DETERMINE DISCHARGEABILITY OF DEBT

          The United States of America (the “United States”) hereby certifies as follows:

          1.     On October 3, 2022 (the “Petition Date”), the above-captioned debtors and

debtors-in-possession (collectively, the “Debtors” and together with the United States, the

“Parties”) filed their voluntary petitions for relief under chapter 11 of title 11 of the United States

Code (the “Bankruptcy Code”).

          2.     On November 10, 2022, the meeting of creditors pursuant to 11 U.S.C. § 341 was

scheduled and conducted (the “341 Meeting”).

          3.     Pursuant to Rule 4007(c) of the Federal Rules of Bankruptcy Procedure (the

“Bankruptcy Rules”), a party in interest may file a complaint under 11 U.S.C. § 523(c) within

sixty days after the first date set for the 341 Meeting.



1
  The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification
number, as applicable are: Kabbage, Inc. d/b/a KServicing (3937) (the “Company”); Kabbage Canada Holdings, LLC
(N/A); Kabbage Asset Securitization LLC (N/A); Kabbage Asset Funding 2017-A LLC (4803); Kabbage Asset
Funding 2019-A LLC (8973); and Kabbage Diameter, LLC (N/A). Kabbage is a trademark of American Express used
under license; Kabbage, Inc. d/b/a KServicing is not affiliated with American Express. The Debtors’ mailing and
service address is 925B Peachtree Street NE, Suite 383, Atlanta, GA 30309.

                Case 22-10951-CTG         Doc 806      Filed 05/08/23   Page 2 of 4




       4.       Accordingly, the deadline by which to file a complaint under 11 U.S.C. § 523(c)

was January 9, 2023 (the “Nondischargeability Deadline”), or such later date as may be ordered

by the Court.

       5.       On January 6, 2023, the United States filed a Certification of Counsel Submitting

Proposed Order Approving Stipulation to Extend the United States’ Deadline to File a Complaint

to Determine Dischargeability of Debt [Docket No. 426]. The Court approved the order attached

thereto, which extended the Nondischargeability Deadline for the United States to May 9, 2023

[Docket No. 429]. The Nondischargeability Deadline as to the United States has not expired as of

the filing of this Certification of Counsel and accompanying stipulation and proposed order.

       6.       On March 15, 2023, the Court entered the Order Confirming Amended Joint

Chapter 11 Plan of Liquidation of Kabbage, Inc. (d/b/a KServicing) and Its Affiliated Debtors

[Docket No. 680] (the “Confirmation Order”), thereby confirming the Amended Joint Chapter

11 Plan of Liquidation of Kabbage, Inc. (d/b/a KServicing) and Its Affiliated Debtors [Docket No.

627] (the “Plan”). The Plan and the Confirmation Order provide that “[n]othing in the Plan or

Confirmation Order shall . . . grant the Debtors a discharge pursuant to section 1141(d) of the

Bankruptcy Code.” See Confirmation Order ¶ 32; Plan § 10.3(f).

       7.       The Plan contemplates that the Debtors will complete their wind down, liquidate

their remaining assets and distribute such assets to their creditors.

       8.       The effective date of the Plan (the “Effective Date”) has yet to occur. The Debtors

expect the Effective Date to occur in the near term.

       9.       To the extent that the filing of a dischargeability complaint under 11 U.S.C.

§ 523(c) may be necessary, the United States seeks an extension of the Nondischargeability

Deadline through and including August 7, 2023.

                                                  2

               Case 22-10951-CTG             Doc 806       Filed 05/08/23       Page 3 of 4




        10.      The Parties agree that nothing in this Certification of Counsel, accompanying

stipulation, or proposed order constitutes a determination that section 523(c) of the

Bankruptcy Code or Bankruptcy Rule 4007(c) apply, or that any deadline exists to seek a

determination of dischargeability under section 1141(d)(6) of the Bankruptcy Code.

        11.      Nevertheless, out of an abundance of caution since the Effective Date is projected

to occur after the current Nondischargeability Deadline for the United States, the Parties have

entered into a Second Stipulation to Extend the United States’ Deadline to File a Complaint to

Determine Dischargeability of Debt (the “Stipulation”), 2 a copy of which is attached as Exhibit 1

to the proposed order attached hereto as Exhibit A (the “Proposed Order”).

        12.      The Stipulation has been circulated to the Office of the United States Trustee for

the District of Delaware, and it does not object to the Debtors’ entry into the Stipulation.

        WHEREFORE, the Parties respectfully request that the Court enter the Proposed Order

at its earliest convenience without further notice or a hearing.


     Dated: May 8, 2023

                                                   BRIAN M. BOYNTON
                                                   Principle Deputy Assistant Attorney General

                                                   DAVID C. WEISS
                                                   United States Attorney

                                                   /s/ Alastair M. Gesmundo
                                                   RUTH A. HARVEY
                                                   RODNEY A. MORRIS
                                                   ALASTAIR M. GESMUNDO
                                                   STANTON MCMANUS
                                                   Commercial Litigation Branch
                                                   Civil Division

2
 Capitalized terms used herein but not otherwise defined herein shall have the meanings ascribed to them in the
Stipulation.

                                                      3

Case 22-10951-CTG   Doc 806   Filed 05/08/23    Page 4 of 4




                       United States Department of Justice
                       P.O. Box 875
                       Ben Franklin Station
                       Washington, D.C. 20044
                       Tel. (202) 305-4659
                       Fax (202) 514-9163
                       Alastair.M.Gesmundo@usdoj.gov

                       Attorneys for the United States of America




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