Herbert Smith Freehills Kramer secures victory for Eletson Holdings Inc. in Chapter 11 fight with ex-owners

Herbert Smith Freehills Kramer secured a major financial victory for Eletson Holdings Inc. (Eletson) – an international energy transport operator specializing in oil and gas cargoes – in the U.S. Bankruptcy Court for the Southern District of New York, after a lengthy battle with the company’s ex-owners over the violation of a Chapter 11 plan confirmation order.

Eletson first entered Chapter 7 bankruptcy in 2023 after a group of creditors filed an involuntary petition against the company, alleging $354 million in defaulted notes and other debts. Representing the creditors at the time, HSF Kramer partner Kyle J. Ortiz successfully proposed a creditor-sponsored Chapter 11 plan during trial, and certain creditors became Eletson’s new owners when the chapter 11 plan went effective in November 2024. 

Since the effective date of the plan, Eletson’s previous owners have refused to comply with the confirmation order, resulting in extensive litigation brought by the reorganized Eletson and the subsequent accrual of legal fees. On behalf of the reorganized company, members of the HSF Kramer have brought (and prevailed) on five separate sanctions motions against the previous owners.

On August 20, 2025, the bankruptcy court approved over $1.9 million in fee and expense applications spent by the company in its post-effective date legal proceedings with the previous owners.

The HSF Kramer team representing Eletson consisted of bankruptcy and restructuring partners Kyle J. Ortiz and Brian F. Shaughnessy, counsel Jennifer R. Sharret, and associates Andrew Citron and Rebecca Polinsky.