Updated October 2026
Data in a 363 sale: what the Spirit case shows
People search for "363 sale" when a bankrupt company sells assets under court supervision. Until 2026 those assets were planes, leases, brands and customer lists. Spirit Airlines changed that by running its internal email, Teams and file archive through the same machinery, and the docket now gives debtors a dated record of how a data-only lot behaves at auction. As of 2026-10-14 the judge had not ruled; the sale hearing is calendared for 2026-11-06.1,2
The dated steps
From bidding motion to proposed sale order
Spirit filed its bidding procedures motion on 2026-05-27 (Dkt. 1117). The court entered the order on 2026-06-22 (Dkt. 1213). Those procedures governed a virtual auction held on 2026-08-14 that lasted about two and a half hours, with Davis Polk and PJT Partners running the room. One wrinkle for anyone citing the date: the ombudsman's report gives 2026-08-13 instead.1,3
Once the auction closed, the debtor filed a proposed sale order on 2026-08-17 (Dkt. 1469). As filed, that draft carried no privacy conditions, no ban on re-identification and no duty to report back to the court. Those terms were argued over afterwards, in objections and in the ombudsman's work.4
| Fact | Value and source |
|---|---|
| Bidding procedures for the data sale | Bidding procedures motion filed 2026-05-27 (Dkt. 1117); order entered 2026-06-22 (Dkt. 1213) |
| Spirit data auction | Virtual auction of about two and a half hours on 2026-08-14, run by Davis Polk and PJT Partners. Google opened at $5.0M and won at $10.0M cash; Mercor is the alternate bidder at $7.5M |
| Proposed sale order | Proposed sale order filed 2026-08-17 (Dkt. 1469). As filed, it contained no privacy conditions, no ban on re-identification and no reporting duty to the court |
How the number moved
The de-identification method was priced, not just the data
Google opened at $5.0M and finished at $10.0M in cash, twice its first number. Mercor stands behind it as the alternate bidder at $7.5M, which is 75% of the winning price.3
Mercor's own bids show what bankers should model. It offered $5.2M if the data came in Google's form with third-party de-identification, and $7.0M if it could use its own tools. It then offered $10.0M on condition of in-house de-identification. The same archive drew different prices depending on who scrubbed it and how.5
A declaration filed after the auction (Dkt. 1470) put it plainly: de-identification and privacy factors "may be outcome-determinative". Our reading: in a data lot, the bid form should ask each bidder to state its de-identification method next to its price, so the two can be compared side by side.6
Older precedent
Consumer-data sales are a different asset
Retail bankruptcies have sold data before. In 2023 Overstock won Bed Bath & Beyond's IP and digital assets, a package that took in internet properties and business data, for $21.5M. That was a brand-and-customer sale, not an internal-communications archive, and it should not be used to price email or Teams data.7
What carries over is the procedure. The US Courts overview of Chapter 11 says a sale outside the ordinary course of business needs the court's permission, and that a liquidating plan is permissible in Chapter 11. Spirit's archive sale is running inside that framework.8
FAQ
Questions, answered with sources
The auction notice gives 2026-08-14 for a virtual auction of roughly two and a half hours. The ombudsman's report dates it 2026-08-13.3
It doubled. Google's opening bid was $5.0M and its winning bid was $10.0M in cash.3
Its price depended on how the data would be de-identified: $5.2M with third-party scrubbing in Google's form, $7.0M with its own tools, and a conditional $10.0M with in-house de-identification. Its $7.5M bid is now the alternate.5
As filed on 2026-08-17, it had no privacy conditions, no re-identification ban and no reporting duty to the court.4
No. As of 2026-10-14 it was not approved, and the hearing is set for 2026-11-06. Google is the successful bidder, not yet the buyer.2
We do not answer legal questions. Ask the licensing company: their team reviews this with you before anything is signed.
We do not answer legal questions. Ask the licensing company: their team reviews this with you before anything is signed.
Before you sign
Legal questions go to the licensing company
We do not answer legal questions. Ask the licensing company before you sign: their team reviews these with you.
Questions for this kind of business
- Does Section 363 reach a license of the archive as well as an outright sale, and does the answer change the notice we give?
- Does Section 332 apply when the archive is de-identified before it changes hands?
- Who owns this data: the company, an estate, or someone else?
- Is a consumer privacy ombudsman, court approval, or notice and a hearing needed?
- What are the trustee's, assignee's, receiver's or board's duties, and who receives the proceeds?
Questions for any buyer
- Is the license exclusive, and for how long?
- Can you sublicense the data, and to whom?
- Which AI labs will receive it, and will you tell us?
- How long do you keep it, and how is it deleted?
- What is your liability cap, and who indemnifies whom?
- Will the contract ban re-identification of people in the data?
- Who removes personal data, by what method, and do we approve it first?