Debtors Creditors

News & Analysis as of

Good News for Creditors in Individual Bankruptcy Cases

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

Insider Loans Equitably Subordinated

In SGK Ventures, LLC, the Bankruptcy Court for the Northern District of Illinois ordered that the secured claims of two entities controlled by insiders of the debtor be equitably subordinated to the claims of unsecured...more

"Recent Rulings Underscore Importance of Careful Drafting of Make-Whole Payment Provisions"

Under long-established common law, loans must be paid only upon maturity, not before. This "perfect tender in time" rule is the default rule in a number of jurisdictions. Many indentures and credit agreements therefore either...more

Global Private Equity Newsletter - Winter 2016 Edition: Recent Developments in Acquisition Finance

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

What Creditors Need to Know - Two Recent Bankruptcy Rulings Affect Rights and Risks Regarding the Automatic Stay

Immediately upon the commencement of a bankruptcy case an automatic stay prohibits actions against the debtor to, among other things, collect pre-petition obligations and to obtain control over property of the bankruptcy...more

Orrick's Financial Industry Week in Review

The PRA Publishes Guidance on Financial Conglomerate Waivers - On January 4, the Prudential Regulation Authority ("PRA") published guidance on the application and supplementary forms that should be submitted by firms...more

New Delaware Chapter 11 Filing – Affiliates of Variant Holding Company, LLC

Thirty-four affiliates of Variant Holding Company, LLC (“Variant”) have filed chapter 11 petitions before the United States Bankruptcy Court for the District of Delaware. The debtors will seek to have their cases jointly...more

Committee Formation Meeting for Restaurants Acquisition I, LLC

Upcoming Committee Formation Meeting: December 22, 2015 at 10:00 a.m. Case Name: Restaurants Acquisition I, LLC, d/b/a Black-Eyed Pea Restaurants and Dixie House - Case Number:15-12406 (KG)...more

Intellectual Property Issues in Bankruptcy and the Exclusion of Trademark Licenses from the Definition of Intellectual Property

The Bankruptcy Code divides intellectual property into distinct categories depending upon the particular type of intellectual property. Issues with respect to intellectual property can be of utmost importance in bankruptcy,...more

New Delaware Chapter 11 Filing – Millennium Lab Holdings II, LLC

Millennium Lab Holdings II, LLC and two of its affiliates, Millennium Health, LLC, and RxAnte, LLC, have commenced cases (Lead Case No. 15-12284) under Chapter 11 of the Bankruptcy Code by filing petitions with the United...more

The fiducie-sûreté: the most effective French security interest?

The fiducie has been the subject of increased interest by lenders over the past few years in France. Even though there is no significant case law supporting this, some academics have gone so far as to refer to this mechanism...more

New Delaware Chapter 11 Filing – Fresh & Easy, LLC

Fresh & Easy, LLC has filed a chapter 11 petition in the United States Bankruptcy Court for the District of Delaware (Case # Case No: 15-12220-CSS). The Petition and list of top 30 creditors and the docket are available...more

Sixth Circuit Files Win for Bankruptcy Debtors Harassed During Automatic Stay

Creditors of bankruptcy debtors beware: a recent opinion from the Sixth Circuit Court of Appeals makes clear that creditors cannot circumvent the ban on collection efforts following the petition for bankruptcy by trying to...more

Another Advantage of Proceedings Supplementary

Debtors oftentimes attempt to shield their assets from creditors by transferring them away to others. If this is done, a creditor can bring an action under Florida’s Uniform Fraudulent Transfer Act (UFTA) to attempt to undue...more

It just got a little bit easier to enforce judgment liens

Last year, we posted It just got a little bit harder to enforce judgment liens, which analyzed a Court of Appeals decision that invalidated a judgment lien against third-party purchasers due to the judgment creditors’ failure...more

Third Circuit Affirms Bad Faith Involuntary Bankruptcy Dismissal, Increasing Risk of Punitive Damages

Last week’s decision by the U. S. Court of Appeals for the Third Circuit in In re: Forever Green Athletic Fields, Inc., No. 14-3906 (3d Cir. Oct. 16, 2015) held that an involuntary bankruptcy petition filed under 11 U.S.C. §...more

Global Private Equity Newsletter - Fall 2015 Edition: Recent Developments in Acquisition Finance

When a portfolio company underperforms, a sponsor may consider various options to address the perceived performance issues, including changes to a portfolio company’s management team, cost structure, capital structure or...more

There’s Nothing Magic About the “Original” Promissory Note

In a victory for creditors, the Alabama Court of Civil Appeals recently reversed a trial judge’s decision to exclude a copy of a promissory note from evidence simply because it was not an original. Without the promissory...more

Equitable Liens: No Mortgage Does Not Necessarily Mean No Lien

Marcum v. Marcum (In re Marcum), 508 B.R. 499 (Bankr. M.D. Fla. 2014) – A creditor made two prepetition loans to a chapter 13 debtor for payment of delinquent real estate taxes. The loans were supposed to be secured by...more

Secured Creditors in Section 363 Sales Be Aware -Your Proceeds May Be Used to Satisfy the Debtor’s Unpaid State Tax Liabilities

It is a basic feature of sales under section 363 of the U.S. Bankruptcy Code, that the purchaser takes free and clear of all claims and interests, such claims and interests attach to the proceeds of the sale in accordance...more

Protecting Your Business: Payment Plans Are Not Necessarily Bankruptcy Proof

“Neither a borrower nor a lender be . . . .” Hamlet Act 1, scene 3, line 75 With all due respect to the great Bard, that simply isn’t possible in today’s business world. Even businesses that are not directly involved...more

Clear Contractual Terms Prevail Over Equitable Principles in Bankruptcy Cases (Again)

Bankruptcy courts in the U.S. are widely viewed as favorable fora for debtors, trustees and creditors’ committees to pursue creative and difficult causes of actions against deep-pockets lenders and others in an attempt to...more

Nuovo Regolamento UE sulle procedure d’insolvenza

Il Regolamento si pone l’obiettivo di rendere più efficienti le regole sulle insolvenze transfrontaliere, trovare il giusto equilibrio nella protezione sia dei debitori che dei creditori e privilegiare il risanamento delle...more

CFPB Sues World Law Group Over Illegal Fees and False Promises in Debt-Relief Scheme

On September 15, the CFPB announced a preliminary injunction obtained against World Law Group and its senior leaders for allegedly running a debt-relief scheme that charged consumers costly and illegal upfront fees. According...more

Sixth Circuit Weighs In On Prior Express Consent

Under what circumstances does a person give his “prior express consent” to be contacted on his cellphone by a creditor? The Sixth Circuit recently examined that very question in Hill v. Homeward Residential, Inc., where it...more

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