More on GGP, independent directors and substantive consolidation

While getting ready for work this morning, I found two excellent posts here and here at Zero Hedge. As you can see, these posts are from last month, but they still bear reading.

Why? It states what may be reality tomorrow, depending on the judge: that General Growth may be able to consolidate its SPE malls into the GGP bankruptcy. If that succeeds, chalk that up in part to good lawyering.

They are saying this is a procedural consolidation only, but is that really true? I'm honestly not sure. I readily admit that, while I worked on a number (say, a dozen or so) of these opinions over the years, I do not live, breathe and eat non-consolidation. No thanks. Here are some D&B thoughts, by the way.

Are there remedies? There could be insurance out there, I suppose. And law firms have, in every case, rendered legal opinions about non-consolidation. These, however, are reasoned legal opinions and while it may not be feasible to go after a law firm for its opinion, don't be shocked if someone tries to go after a possible deep pocket.

You may recall that I really didn't want to see GGP file, because of the human element and because of the very messy roll of the dice that BK can be. The problem is that this could bode a really tough future for lending, because of the impairment of the lender's ability to go after a single property. And here it just may be coming true....