A basic tenet of bankruptcy law, premised on the legal separateness of a debtor prior to filing for bankruptcy and the estate created upon a bankruptcy filing, is that prepetition debts are generally treated differently than...more
3/2/2020
/ Administrative Expenses ,
Administrative Priority ,
Bankruptcy Code ,
Bankruptcy Court ,
Bifurcation ,
Chapter 11 ,
Chapter 7 ,
Commercial Bankruptcy ,
Congressional Intent ,
Debtors ,
Gross Receipts Tax ,
Income Taxes ,
Legislative History ,
Tax Liability
In the July/August 2019 issue of the Business Restructuring Review, we discussed a landmark decision by the U.S. Court of Appeals for the Fifth Circuit in In re Ultra Petroleum Corp., 913 F.3d 533(5th Cir. 2019) ("Ultra I")....more
Under the "single-satisfaction rule," although a bankruptcy trustee or a chapter 11 debtor-in-possession ("DIP") may seek to avoid and recover avoidable transfers of a debtor's property from more than one transferee, the...more
Chapter 11 Plan Distributions Are Not Collateral Covered by Intercreditor Agreement's Waterfall Provision -
In In re Energy Future Holdings Corp., 2019 WL 2535700 (3d Cir. June 19, 2019), a panel of the U.S. Court of...more
9/26/2019
/ Bankruptcy Code ,
Bankruptcy Reform ,
Chapter 11 ,
Chapter 15 ,
Commercial Bankruptcy ,
Corporate Restructuring ,
Cross-Border ,
Debt Restructuring ,
Debtors ,
Financial Institutions ,
Insolvency ,
Trump Administration
On August 23, 2019, President Trump signed into law four pieces of bankruptcy legislation designed to help financially distressed small businesses, disabled veterans, National Guard and reservists, and family farmers. Those...more
9/26/2019
/ Bankruptcy Code ,
Bankruptcy Plans ,
Bankruptcy Reform ,
Chapter 11 ,
Chapter 12 ,
Commercial Bankruptcy ,
National Guard ,
NDAA ,
New Legislation ,
Small Business ,
Trump Administration ,
Veterans ,
Veterans Administration
The Bankruptcy Code creates a rebuttable presumption that a proof of claim is prima facie evidence of the claim's validity and amount. Courts disagree, however, over whether that presumption also applies in a proceeding to...more
9/25/2019
/ Bankruptcy Code ,
Bankruptcy Court ,
Bifurcation ,
Chapter 11 ,
Chapter 13 ,
Chapter 7 ,
Evidentiary Standards ,
Federal Rules of Bankruptcy Procedure ,
Personal Property ,
Proof of Claims ,
Rebuttable Presumptions ,
Section 502
In In re Energy Future Holdings Corp., 2019 WL 2535700 (3d Cir. June 19, 2019), a panel of the U.S. Court of Appeals for the Third Circuit ruled that adequate protection payments made during a bankruptcy case and...more
In This Issue:
Washington District Court Overturns Approval of Third-Party Releases in a Settlement Agreement and Related Free-and-Clear Sale -
In In re Fraser’s Boiler Serv., Inc., 2019 WL 1099713 (D. Wash. Mar. 18,...more
8/21/2019
/ Bankruptcy Code ,
Bankruptcy Court ,
Bankruptcy Discharge Order ,
Chapter 11 ,
Chapter 15 ,
Commercial Bankruptcy ,
Debt Collection ,
FERC ,
Foreign Debt ,
PG&E ,
Settlement Agreements ,
Taggart v Lorenzen
The recent chapter 11 filings by PG&E Corp. and its Pacific Gas & Electric Co. utility subsidiary (collectively, "PG&E") and FirstEnergy Solutions Corp. have reignited the debate over the power of a U.S. bankruptcy court to...more
8/21/2019
/ Bankruptcy Code ,
Bankruptcy Court ,
Chapter 11 ,
Debtors-in-Possession ,
Energy Contracts ,
Federal Power Act ,
FERC ,
Filed-Rate Doctrine ,
Mission Product Holdings Inc v Tempnology LLC ,
PG&E ,
Popular ,
Power Purchase Agreements ,
Section 365
In In re Ultra Petroleum Corp., 913 F.3d 533(5th Cir. 2019), the U.S. Court of Appeals for the Fifth Circuit ruled that a "make-whole," or "prepayment," premium owed on unsecured notes issued by a chapter 11 debtor...more
In Trinity 83 Dev., LLC v. ColFin Midwest Funding, LLC, 917 F.3d 599 (7th Cir. 2019), the U.S. Court of Appeals for the Seventh Circuit held that section 363(m) of the Bankruptcy Code does not moot an appeal involving a...more
8/20/2019
/ Appeals ,
Article III ,
Asset Purchaser ,
Bankruptcy Code ,
Chapter 11 ,
Commercial Bankruptcy ,
Debtors ,
Equitable Mootness ,
Equitable Relief ,
Mootness ,
Sale of Assets ,
Section 363 ,
Standing
In Mission Product Holdings, Inc. v. Tempnology, LLC, 139 S. Ct. 652, 2019 WL 2166392 (U.S. May 20, 2019), the U.S. Supreme Court ruled that the rejection in bankruptcy of a trademark license agreement, which constitutes a...more
8/20/2019
/ Bankruptcy Appellate Panel (BAP) ,
Bankruptcy Code ,
Breach of Contract ,
Chapter 11 ,
Commercial Bankruptcy ,
Debtors ,
Debtors-in-Possession ,
Exclusions ,
Executory Contracts ,
IP License ,
Mission Product Holdings Inc v Tempnology LLC ,
Rescission ,
Reversal ,
SCOTUS ,
Section 365 ,
Split of Authority ,
Trademark Licenses ,
Trademarks ,
Trustees
For nearly 25 years, courts in the Ninth Circuit have consistently refused to sanction nonconsensual third-party releases as part of chapter 11 plans. A ruling recently handed down by the U.S. District Court for the District...more
8/20/2019
/ Asbestos Litigation ,
Asbestos Trust Claims ,
Bankruptcy Code ,
Bankruptcy Court ,
Chapter 11 ,
Collateral Estoppel ,
Commercial Bankruptcy ,
Cost-Sharing ,
Debtors-in-Possession ,
Reorganizations ,
Section 363 ,
Successor Liability ,
Third-Party Relationships ,
Third-Party Release Agrements
Second Circuit Rules That Bankruptcy Code's Fraudulent Transfer Recovery Provisions Can Reach Foreign Transferees -
In In re Picard, Trustee for the Liquidation of Bernard L. Madoff Inv. Sec. LLC, 917 F.3d 85 (2d Cir....more
6/21/2019
/ Banking Sector ,
Chapter 11 ,
Chapter 15 ,
Commercial Bankruptcy ,
Corporate Restructuring ,
Cross-Border Transactions ,
Debt Restructuring ,
Debtors ,
FDCPA ,
Financial Institutions ,
Foreclosure ,
Insolvency ,
International Litigation
In In re Tribune Co. Fraudulent Conveyance Litig., 2019 WL 1771786 (S.D.N.Y. Apr. 23, 2019), the U.S. District Court for the Southern District of New York denied a litigation trustee’s motion to amend a complaint seeking to...more
6/19/2019
/ Avoidance ,
Bankruptcy Code ,
Chapter 11 ,
Commercial Bankruptcy ,
Creditors ,
Debtors ,
Financial Institutions ,
Fraudulent Transfers ,
Intermediaries ,
Leveraged Buyout ,
Merit Management Group v FTI Consulting ,
Safe Harbors ,
SCOTUS ,
Section 546(e) ,
Split of Authority ,
Trustees
In Momentive Performance Materials Inc. v. BOKF, NA (In re MPM Silicones, L.L.C.), 874 F.3d 787 (2d Cir. 2017), cert. denied, 138 S. Ct. 2653 (2018), the U.S. Court of Appeals for the Second Circuit affirmed a number of lower...more
6/19/2019
/ Appeals ,
Bankruptcy Court ,
Chapter 11 ,
Chapter 13 ,
Commercial Bankruptcy ,
Cramdown ,
Debt Restructuring ,
Debtors ,
Debtors-in-Possession ,
First-Lien ,
Interest Rates ,
Make-Whole Premium ,
Noteholders ,
Remand ,
Secured Notes ,
Subordination ,
Trustees
In In re Argon Credit, LLC, 2019 WL 169315 (Bankr. N.D. Ill. Jan. 10, 2019), the U.S. Bankruptcy Court for the Northern District of Illinois ruled that, in accordance with section 510(a) of the Bankruptcy Code, a standby...more
In Tanguy v. West (In re Davis), 2018 WL 4232063 (5th Cir. Sept. 5, 2018), the U.S. Court of Appeals for the Fifth Circuit revisited the circumstances under which section 363(m) of the Bankruptcy Code moots an appeal of a...more
Rumors of another recession multiplied as the tumultuous second year of the Trump administration came to a close. Highlights of 2018 included a simmering trade war with China; political upheaval after the House of...more
On September 21, 2018, the U.S. District Court for the District of Delaware affirmed a bankruptcy court's ruling that it had the constitutional authority to grant nonconsensual third-party releases in an order confirming the...more
12/21/2018
/ Article III ,
Chapter 11 ,
Commercial Bankruptcy ,
Counterclaims ,
Cramdown ,
Jurisdiction ,
Lack of Authority ,
Proof of Claims ,
Racketeering ,
Section 363 ,
Shareholders' Agreements ,
State Law Claims
Amid the explosion of trading in claims against distressed and bankrupt entities, courts in recent years have issued numerous rulings of interest to both buyers and sellers. Notable decisions have addressed, among other...more
10/12/2018
/ Anti-Assignment Clauses ,
Bankruptcy Code ,
Breach of Contract ,
Business Transfer Agreements ,
Cause of Action Accrual ,
Caveat Emptor ,
Chapter 11 ,
Disallowance Defense ,
Equitable Subordination ,
Promissory Notes ,
State Law Tort Claims ,
Uniform Commercial Code (UCC)
In a highly anticipated decision, the U.S. Court of Appeals for the Fifth Circuit recently affirmed a bankruptcy court order dismissing a chapter 11 case filed by a corporation without obtaining—as required by its corporate...more
10/11/2018
/ Acquisitions ,
Automatic Stay ,
Bankruptcy Court ,
Borrowers ,
Chapter 11 ,
Controlling Stockholders ,
Corporate Charters ,
Creditors ,
Delaware General Corporation Law ,
Fiduciary Duty ,
Forbearance Agreements ,
Franchises ,
Lenders ,
Mergers ,
Private Equity ,
Public Policy
In a highly anticipated decision—Sabine Oil & Gas Corp. v. Nordheim Eagle Ford Gathering, LLC (In re Sabine Oil & Gas Corp.), 734 Fed. Appx. 64, 2018 WL 2386902 (2d Cir. May 25, 2018)—the U.S. Court of Appeals for the Second...more
In This Issue:
Caveat Emptor—Anti-Assignment Clause Renders Transferred Claim Unenforceable -
In In re Woodbridge Group of Companies, LLC, 2018 WL 3131127 (Bankr. D. Del. June 20, 2018), the bankruptcy court ruled...more
In the wake of scandal-driven bankruptcies filed by nearly 20 U.S. Roman Catholic dioceses and religious orders, scrutiny has been increasingly brought to bear on the benefits and burdens that federal bankruptcy laws offer to...more
8/15/2018
/ Alter Ego ,
Bankruptcy Code ,
Chapter 11 ,
Chapter 7 ,
Churches ,
Debtor-Creditor ,
Educational Institutions ,
Federal Rules of Bankruptcy Procedure ,
Hospitals ,
Involuntary Bankruptcy ,
Nonprofits ,
Religious Institutions