## Facts

- The Wintz Companies (a trucking business) held a long-term leasehold interest in a truck terminal in Roseville, Minnesota.
- In 1995, the debtor transferred the leasehold to a related entity, Wintz Properties, Inc. (WP), amid significant secured debt and federal tax liens affecting related entities.
- After the debtor filed for Chapter 11, the trustee sued to avoid multiple transfers, including the leasehold transfer, under Minnesota fraudulent-transfer law.
- The bankruptcy court avoided the 1995 transfer and recovered the leasehold for the bankruptcy estate.
- The trustee marketed the recovered leasehold and negotiated a sale to American Freightways, Inc. (AFI) as the highest bidder.
- The sale agreement included a “last-look” (matching-right) provision allowing AFI to match a higher bid raised through an objection claiming the price was inadequate.
- The bankruptcy court approved the trustee’s § 363 sale to AFI over WP’s objections.
- WP appealed the sale order; WP also had a separate appeal pending from the avoidance judgment concerning whether the leasehold belonged to the estate.

## Issues

1. Whether a matching-right (“last-look”) provision in a § 363 sale agreement improperly chills bidding and makes the sale process procedurally defective.
2. Whether the sale could be reversed based on WP’s contention that the leasehold was not estate property if WP later prevailed in its separate appeal, and whether 11 U.S.C. § 363(m) barred such relief absent a stay.

## Decision

- The Bankruptcy Appellate Panel affirmed the order approving the § 363 sale to AFI.
- The panel held the matching-right provision was permissible and did not, on this record, render the sale unfair or noncompetitive.
- The panel held § 363(m) protected the consummated sale to AFI as a good-faith purchaser because WP did not obtain a stay pending appeal.
- The panel rejected WP’s attempt to use a potential future reversal in the separate avoidance appeal as a basis to unwind the completed sale.

## Legal Principles

- Bankruptcy courts have broad discretion to structure § 363 sales to obtain fair value for the estate, subject to review for abuse of discretion/clear error as applicable.
- Bid-protection devices, including matching rights, are not per se invalid; they may be approved when they serve the estate’s interests and are not shown to suppress competitive bidding.
- Under 11 U.S.C. § 363(m), an unstayed sale authorized under § 363 to a good-faith purchaser generally cannot be reversed or modified on appeal if the requested relief would affect the validity of the sale.
- A collateral challenge to the estate’s interest in the property, including one dependent on a separate appeal, does not permit unwinding a consummated, unstayed § 363 sale protected by § 363(m).

## Conclusion

The panel upheld the trustee’s sale of the leasehold to AFI, concluding that the matching-right clause was an acceptable sale term aimed at maximizing estate value and that § 363(m) barred appellate relief that would undo the completed sale because WP failed to obtain a stay and AFI purchased in good faith.


Wintz Props., Inc. v. Am. Freightways, Inc. (In re Wintz Cos.), 230 B.R. 840 (B.A.P. 8th Cir. 1999)