If a business engages in bad behavior like intentional interference with contract and tortious interference with business relations, then it may not use Subchapter V of Chapter 11 to discharge debts based on that bad...more
France has now introduced a new restructuring tool following the enactment of Ordinance 2021- 1193 (the “Ordinance”), which incorporates the Directive (EU) 2019/1023 on preventive restructuring frameworks (the “Directive”)...more
The COVID-19 pandemic has already caused numerous companies to file for bankruptcy relief and will likely cause many more to do so. In this environment, it is particularly important for both licensees and licensors of...more
For many years, people associated with the bankruptcy system in the United States recognized the process didn’t work well for small business owners. Corporate reorganizations through the Chapter 11 process were cumbersome and...more
The next few years are expected to see a significant increase in the volume of bankruptcy cases filed by health care providers. Thus far in 2017, the number of bankruptcies in health care-related sectors, including hospitals,...more
For the past several years, creditors in the Ninth Circuit were confounded by an interpretation of the bankruptcy code that permitted individual chapter 11 debtors to retain a significant portion of their assets without...more
Two recent court decisions may result in a broadening of the range of options available to an equity sponsor in respect of an insolvent portfolio company. The first decision may provide increased flexibility in structuring...more
Unless creditors accept a debtor's plan of reorganization, bankruptcy law requires the plan to provide for the payment in full of creditors before owners of the debtor receive anything on account of their equity interest....more
As the economic recovery continues to wind along through the up and down financial cycles that have been the hallmark of the last four years, there can be little doubt that some individuals historically on the higher end of...more
In a recent decision, In re Castleton Plaza, LP, 2013 WL 537269 *1 (Feb. 14, 2013), the Seventh Circuit held that the absolute priority rule – which requires that creditors be paid in full before equity holders receive...more
Last October, I wrote about a scheme employed, in three separate bankruptcy cases, by debtors seeking to evade the absolute priority rule in order to keep the real property owned by the debtor in the hands of the ‘family’ at...more
Can an equity investor who directs an insider to contribute "new value" to a debtor under a plan of reorganization, so as to retain his interest in the company, avoid an express market test for that new equity? The answer to...more
In a decision issued yesterday, the 7th Circuit Court of Appeals held that insiders can't be given a special opportunity to invest in a bankrupt debtor under the guise of contributing "new value" unless the debtor makes the...more