Shenwick & Associates Achieves Favorable Settlement in In re Celsius Preference Avoidance Action — Default Judgment Vacated

 

Shenwick & Associates Achieves Favorable Settlement in In re Celsius Preference Avoidance Action — Default Judgment Vacated

As regular readers of this blog are aware, Shenwick & Associates has developed a recognized legal specialty in cryptocurrency-related matters, including the defense of preference avoidance actions arising out of the In re Celsius Network LLC bankruptcy proceedings.

To date, our firm has successfully resolved numerous Celsius preference avoidance actions on favorable terms for defendants named in adversary proceedings. We are pleased to report a recent matter that underscores the importance of prompt legal intervention, even where a defendant's procedural posture has been significantly compromised.

Background

Our firm was recently retained by a Celsius adversary proceeding defendant domiciled in Europe who had been sued for in excess of $660,000. Prior to retaining counsel, our client failed to respond to multiple communications from Celsius and did not file a timely Answer to the Complaint. As a result, a Default Judgment was entered against him in both the United States and in the relevant European jurisdiction.

Our Representation and Result

Following entry and service of the Default Judgment, our client retained James Shenwick, Esq. to seek vacatur of the Default Judgment and to negotiate a resolution of the underlying claim. Our firm promptly moved to vacate the Default Judgment, filed a responsive Answer to the Complaint, and engaged in substantive settlement negotiations with opposing counsel.

We are pleased to announce that the matter was resolved for approximately 8% of the original claim amount — a result that represents an extraordinary outcome given the procedural posture of the case at the time of our retention. Notably, the client was also able to fund the settlement using cryptocurrency, providing additional flexibility in satisfying the agreed-upon terms.

Contact Shenwick & Associates

If you have been named as a defendant in a Celsius preference avoidance action — whether you have already received a Default Judgment or have simply been served with a Complaint — we strongly urge you to contact our office promptly. Delay can have significant legal and financial consequences.

James Shenwick, Esq.

Shenwick & Associates

📞 917-363-3391

✉️ jshenwick@gmail.com

To schedule a telephone consultation, please click the link below:

🔗 Schedule a Call with James Shenwick, Esq.

Please click the link to schedule a telephone call with me.

https://calendly.com/james-shenwick/15

Shenwick & Associates counsels individuals and businesses confronting significant debt obligations, as well as creditors navigating bankruptcy proceedings.

Slutty Vegan’s owner couldn’t pay back a $1M Covid-era disaster loan (SBA EIDL loan). She isn’t alone

 

Slutty Vegan’s owner couldn’t pay back a $1M Covid-era disaster loan. 

She isn’t alone according to an article at  bizwoman, which can be found at 

   https://www.bizjournals.com/boston/bizwomen/news/latest-news/2026/03/covid-era-eidl-loan-program-debt-bankruptcy.html?page=all

Jim Shenwick, Esq may have been able to help her!

Clients or their advisors with questions about SBA EIDL loan defaults should contact  Jim Shenwick, Esq

Jim Shenwick, Esq  917 363 3391  jshenwick@gmail.com 

Please click the link to schedule a telephone call with me.

 https://calendly.com/james-shenwick/15min

We help individuals & businesses with too much debt! & creditors in Bankruptcy cases

Small Business Bankruptcy & Subchapter V

Is Subchapter V Bankruptcy Right for Your Small Business?

By Jim Shenwick, Esq. | Shenwick & Associates

At Shenwick & Associates, we are receiving an increasing number of calls from businesses in financial distress. Whether their liabilities exceed their assets, or they lack sufficient cash flow to service debt and cover operating expenses, these businesses are facing difficult decisions.

Three Options for a Financially Distressed Business

Businesses in financial difficulty generally have three options:

1. Do nothing and close the business;

2. File a Chapter 7 bankruptcy and have the business liquidated by a Chapter 7 Bankruptcy Trustee; or

3. File for Chapter 11 bankruptcy. Within Chapter 11, there are two paths: a traditional Chapter 11 filing, or a Subchapter V small business bankruptcy filing.

Why Traditional Chapter 11 Is Often Not the Answer

For most small businesses, traditional Chapter 11 is too complicated, costly, and time-consuming. Many businesses that file for Chapter 11 ultimately have their cases converted to a Chapter 7 liquidation ( leaving them no better off than if they had simply closed) or the case is dismissed.

The Advantages of Subchapter V

Subchapter V was designed specifically to give small businesses a more accessible and affordable path through bankruptcy. Key advantages include:

• No U.S. Trustee (UST) fees. Unlike traditional Chapter 11, Subchapter V debtors are not required to pay quarterly UST fees.

• No Absolute Priority Rule. The business owner is not required to pay creditors in strict priority order before retaining an ownership interest.

• Owner may retain the business. If a Plan of Reorganization is confirmed, the debtor can retain ownership of the business.

• Impaired creditors need not approve the Plan. The Plan can be confirmed without the affirmative vote of impaired creditors, provided certain conditions are met.

• No Disclosure Statement required. Unlike traditional Chapter 11, a separate Disclosure Statement does not need to be filed with the Court.

• The Plan may modify the rights of secured creditors holding claims secured by the debtor’s principal residence, which is a significant tool not available in traditional Chapter 11.

Key Requirements of Subchapter V

To qualify and operate under Subchapter V, a business must meet several important requirements:

• At least 50% of the debtor’s total debt must be business-related debt.

• A Plan of Reorganization must be filed within 90 days of the bankruptcy filing.

• The debtor must commit all projected disposable income to Plan payments.

While the above is a brief overview, Subchapter V offers meaningful benefits for eligible small businesses seeking a viable path forward without the burden and expense of a traditional Chapter 11 case. Every business situation is unique, and a thorough analysis is required to determine whether Subchapter V is the right fit.

Contact Us

If you are a business owner, client, or advisor with questions about business bankruptcy or Subchapter V, please contact Jim Shenwick, Esq. for a consultation.

Jim Shenwick, Esq.  |  Shenwick & Associates

Phone: 917-363-3391   Email: jshenwick@gmail.com

Schedule a call: 

Please click the link to schedule a telephone call with me.

https://calendly.com/james-shenwick/15min

We help individuals and businesses with too much debt, as well as creditors in bankruptcy cases.