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HEARING DATE: OCTOBER 25, 2011 HEARING TIME: 10:00 A.M. TARTER KRINSKY & DROGIN LLP Attorneys for The Christian Brothers Institute, et al. Debtors and Debtors-in-Possession 1350 Broadway, 11th Floor New York, New York 10018 (212) 216-8000 Scott S. Markowitz, Esq. Eric H. Horn, Esq. UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ------------------------------------------------------------------- x In re: : : THE CHRISTIAN BROTHERS INSTITUTE, et al. : : Debtors. : ------------------------------------------------------------------- x

Chapter 11 Case No.: 11-22820 (RDD) (Jointly Administered)

DEBTORS MOTION FOR ORDER AUTHORIZING IMPLEMENTATION OF CERTAIN NOTICING PROCEDURES TO: THE HONORABLE ROBERT D. DRAIN UNITED STATES BANKRUPTCY JUDGE The Christian Brothers Institute (CBI)1 and The Christian Brothers of Ireland, Inc. (CBOI),2 the above-captioned debtors and debtors-in-possession (individually a Debtor and collectively, the Debtors) hereby file this motion (the Motion) for entry of an order, pursuant to 11 U.S.C. 105(a) and Rules 1015(c) and 9007 of the Federal Rules of Bankruptcy Procedure, authorizing the implementation of certain noticing procedures. In support of the Motion, the Debtors respectfully represent as follows:

The last four digits of CBIs employer identification number are 0153 and its mailing address is 21 Pryer Terrace, New Rochelle, New York 10804.
2

The last four digits of CBOIs employer identification number are 0603 and its mailing address is10001 S. Pulaski, Room 106, Chicago, IL 60655-3356.

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JURISDICTION 1. This Court has jurisdiction to consider this matter pursuant to 28 U.S.C. 157

and 1334. This is a core proceeding pursuant to 28 U.S.C. 157(b). Venue is proper before this Court pursuant to 28 U.S.C. 1408 and 1409. The statutory predicates for the relief requested herein are 11 U.S.C. 105(a) and Rules 1015(c) and 9007 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules). BACKGROUND 2. On April 28, 2011 (the Petition Date), each of the Debtors commenced their

Chapter 11 cases by filing a voluntary petition for relief under Chapter 11 of Title 11 of the United States Code (the Bankruptcy Code). Pursuant to 1107(a) and 1108 of the

Bankruptcy Code, the Debtors continue to operate their businesses as debtors-in-possession. 3. The Debtors cases were consolidated for administrative purposes only, by order

dated May 2, 2011. Thereafter, by order dated May 18, 2011, the Debtors were authorized to retain Tarter Krinsky & Drogin LLP as bankruptcy counsel. 4. On May 11, 2011, the United States Trustee appointed an Official Committee of

Unsecured Creditors (the Committee). The Committee retained Pachulski Stang Ziehl & Jones LLP as its counsel. 5. CBI is a domestic not-for-profit 501(c)(3) corporation organized under

102(a)(5) of the New York Not-for-Profit Corporation Law. CBI was formed in 1903 pursuant to 57 of the then existing New York Membership Law. The Not-for-Profit Corporation Law replaced the Membership Law effective September 1, 1970. The purpose for which CBI was, and continues to be, formed was to establish, conduct and support Catholic elementary and secondary schools principally throughout New York State. As a not-for-profit corporation, the

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assets, and/or income are not distributable to, and do not inure to the benefit of its directors, or officers. CBI depends upon grants and donations to fund a portion of its operating expenses. 6. CBOI is a domestic not-for-profit 501(c)(3) corporation organized under the Not-

for-Profit Corporation Law of the State of Illinois. The purpose for which is to conduct and support Catholic elementary and secondary schools principally throughout the State of Illinois, as well as other spiritual and temporal affairs of the former Brother Rice Province of the Congregation of Christian Brothers. As a not-for-profit corporation, the assets, and/or income are not distributable to, and do not inure to the benefit of its members, or officers. CBOI depends upon grants and donations to fund a portion of its operating expenses. 7. The cause for the filing of these cases has been extensively detailed in the

affidavit pursuant to Local Bankruptcy Rule 1007-2 filed with the original petitions, and is referred to as if fully set forth herein. In short, the Debtors Chapter 11 cases were filed in an effort to resolve in one forum, an onslaught of litigation and claims asserted by alleged sexual abuse plaintiffs against the Debtors. 8. By order dated June 28, 2011, CBI was authorized to retain Newmark &

Company Real Estate, Inc. d/b/a Newmark Knight Frank (Newmark) as its exclusive real estate broker with respect to the marketing and sale of real property located at 74 W. 124th Street, New York, NY 10027. This is the first of a number of properties that the Debtors are presently reviewing to determine which properties may be sold as part of their efforts to reorganize and propose a plan to creditors in these cases. 9. The Debtors retained accountants who will be reviewing the Debtors finances,

and will give the Debtors advice with respect to (i) operations; (ii) the funding that will be required for continued operations; and (iii) evaluating the costs to modify or change their present

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structure. The Debtors believe that this analysis will take several months and must be completed before embarking on plan/reorganization negotiations. 10. A major issue in these cases is the establishment of a bar date for the filing of

claims and determining in which jurisdictions notice of the bar date should be advertised/published. It is critical that the Debtors make extensive efforts to notify potential abuse claimants of the importance and the need to file a proof of claim. In that regard, the Debtors, after consultation with the Committee and the U.S. Trustee, retained Omni Management Group to aid the Debtors in connection with their noticing and administrative responsibilities under 28 U.S.C. 156(c) and 11 U.S.C. 327(a). The Debtors have prepared a draft bar date motion and are in the process of negotiating the terms of same and the scope of the notice campaign with the Committee. 11. The Debtors Chapter 11 cases are somewhat unique in that the Debtors, over a

period of many decades, either operated or were significantly involved with several schools, and other institutions across the United States and Canada. Noticing and advertising the bar date will be a significant and costly undertaking in these Chapter 11 cases. 12. In an effort to preserve as much cash as possible, the Debtors are filing this

Motion to implement certain streamlined notice and filing procedures. RELIEF REQUESTED 13. By this Motion, the Debtors seek authority, pursuant to 105(a) of the

Bankruptcy Code and Bankruptcy Rules 1015(c) and 9007, to implement certain noticing procedures (the Procedures) in connection with the administration of these Chapter 11 cases. The Debtors request that, to the extent that any of the Procedures conflict with the provisions of the Bankruptcy Code, the Bankruptcy Rules or the Local Bankruptcy Rules for the Southern

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District of New York (the Local Rules), the Procedures shall govern and supersede such provisions and rules. THE PROCEDURES 14. The Debtors submit that motions, applications, complaints, objections, notices,

briefs, memoranda, affidavits, declarations or other writings filed in these Chapter 11 cases (including notices and orders by the Court, but not including proofs of claim) (collectively, the Bankruptcy Filings) for which particular notices are required pursuant to Bankruptcy Rules 2002(a)(2), 2002(a)(3), 4001, 6004, 6006 or 6007 should be subject to the following notice procedures:3 (a) Unless otherwise ordered by this Court, Bankruptcy Filings relating to the use, sale, lease or abandonment of property will be served on each entity having a known ownership interest in the property or a known lien or encumbrance on the property. Bankruptcy Filings relating to relief from the automatic stay under 362 of the Bankruptcy Code or other automatic stay matters will be served, as applicable, on (i) each entity having a known ownership interest in or known lien or encumbrance on any affected property and (ii) the parties to any underlying lawsuit or administrative proceeding and their counsel of record. Bankruptcy Filings relating to approval of a proposed compromise or settlement will be served on each entity that is a party to the compromise and settlement. Bankruptcy Filings relating to rights under 365 of the Bankruptcy Code will be served on each party to the executory contract(s) or unexpired lease(s) sought to be affected. Bankruptcy Filings relating to applications for payment of compensation or reimbursement of expenses of professionals will be served in accordance with the order establishing procedures for interim compensation and reimbursement of expenses for professionals entered by the Court.

(b)

(c)

(d)

(e)

Notwithstanding the Procedures set forth herein, notice of all pleadings will be served on counsel to the Committee, the Office of the United States Trustee for this district, and all parties that filed a notice of appearance pursuant to Bankruptcy Rule 2002.

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(f)

Notice of other matters for which the Bankruptcy Rules require notice to all parties in interest will be served on all creditors, unless otherwise ordered by the Court. BASIS FOR RELIEF

15.

Bankruptcy Rule 9007 grants the Court general authority to regulate notices.

Bankruptcy Rules 2002(i), 2002(m), 6006, 6007, and 9006 establish procedures which authorize the Court to limit notice of certain actions. Section 105(a) of the Bankruptcy Code provides in relevant part that [t]he Court may issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title. 11 U.S.C. 105(a). The Debtors submit that implementation of the Procedures is appropriate in these Chapter 11 cases and well within the Courts equitable powers under 105 of the Bankruptcy Code and the applicable Bankruptcy Rules referenced above. 16. The Debtors cases are highly visible and of interest to the public and media.

That being the case, the Debtors anticipate that numerous pleadings particularly 9019 settlement motions may be filed requiring notice on the creditor body. Service of each filing on each claimant, as is sometimes required absent a court order to the contrary, would be a waste of the Debtors limited resources. In addition, the Debtors will be seeking to sell certain real property, which contain various personal property, which the Debtors believe are of inconsequential value. The Procedures will enable the Debtors to limit notice of such

abandonment. The Debtors submit that because of the potentially significant number of parties in interest in these cases, the Procedures are necessary to preserve cash and are thus warranted and appropriate. 17. Similar procedures have recently been approved in a Chapter 11 case with issues

similar to the Debtors cases. See In re Archdiocese of Milwaukee (Bankr. E.D. Wisc. Jan 6, 2011) [Docket No. 30]. Courts in this District routinely grant orders limiting notice as 6

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contemplated by Bankruptcy Rule 2002(i). The Debtors submit that their circumstances warrant similar relief. NOTICE 18. The Debtors have served notice of this Application on (i) the office of the United

States Trustee for this District, (ii) counsel for the Committee, (iii) the twenty largest unsecured creditors of each of the Debtors, (iv) all parties who have filed a proof of claim in the Debtors cases, and (v) all parties who filed a notice of appearance in these cases pursuant to Bankruptcy Rule 2002. The Debtors respectfully submit that no further or other notice need be provided under the circumstances of these cases. NO PRIOR REQUEST 19. other court. WHEREFORE, the Debtors respectfully request that the Court grant the relief requested herein and such other and further relief as is just and appropriate. Dated: New York, New York September 28, 2011 TARTER KRINSKY & DROGIN LLP Attorneys for The Christian Brothers Institute, et al. Debtors and Debtors-in-Possession By: /s/ Scott S. Markowitz Scott S. Markowitz Eric H. Horn 1350 Broadway, 11th Floor New York, New York 10018 (212) 216-8000 No prior application for the relief requested herein has been made to this or any

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