News & Analysis as of

Uniform Commercial Code (UCC) General Motors

Patterson Belknap Webb & Tyler LLP

A Gigantic Filing Error Provides an Opportunity to Expound the Earmarking Doctrine

Can another vain attempt to mitigate a $1.5 billion mistake provide the occasion for a thorough review of the doctrine of earmarking? It did for Southern District Bankruptcy Judge Martin Glenn in the long tail on the General...more

Dorsey & Whitney LLP

Second Circuit Rules Unintended UCC Termination Statement Was Authorized

Dorsey & Whitney LLP on

When terminating a financing statement, it is necessary to be certain that other financing statements are not unintentionally released, according to an opinion last week of the Second Circuit Court of Appeals. The effect of...more

Winthrop & Weinstine, P.A.

Erroneous UCC-3 Termination Leads to Disastrous Consequences

In a recent decision, a U.S. Court of Appeals held that the filing of a UCC-3 termination statement in a relatively simple payoff transaction between General Motors and a lender was still considered "authorized," despite the...more

Parker Poe Adams & Bernstein LLP

A Cautionary Tale – The Need for Bank Oversight on Collateral Releases

Beware!! The story brought to us today courtesy of the Second Circuit Court of Appeals (In re: Motor Liquidation Co., 13-2187) is one that should strike fear into the hearts of all bankers and lawyers. It is a cautionary tale...more

King & Spalding

Delaware Supreme Court: A Mistakenly Authorized UCC Termination Statement is Effective to Terminate Original UCC Filing

King & Spalding on

On October 17, 2014, the Delaware Supreme Court entered an opinion holding that a UCC-3 termination statement that is authorized by the secured party is effective to terminate the original UCC filing even though the secured...more

Eversheds Sutherland (US) LLP

Delaware Supreme Court Finds UCC Termination Filings Valid Despite Lack of Lender’s Intent

On October 17, the Delaware Supreme Court held that JP Morgan (JPM) terminated its security interest in all of the collateral provided by General Motors (GM) in support of a $1.5 billion loan, despite neither party intending...more

Foley & Lardner LLP

Delaware Supreme Court Rules Mistakenly Filed UCC Termination Statement Is Effective in $1.5 Billion Secured Loan Transaction

Foley & Lardner LLP on

Lenders need to exercise great caution when filing a UCC-3 termination statement. They must make sure that the list of security interests terminated is accurate and that the statement does not mistakenly include other,...more

Bond Schoeneck & King PLLC

UCC-3 Termination Statements: Can They be Trusted?

The holdings of two recent decisions from the Bankruptcy Courts of the Western District of Pennsylvania and the Southern District of New York, handed down within three days of each other in March, both affect the amount of...more

Orrick, Herrington & Sutcliffe LLP

General Motors Bankruptcy Court Applies the Brakes to Unauthorized Termination Statements

Last week, the United States Bankruptcy Court for the Southern District of New York held that a UCC-3 termination statement is effective to terminate a financing statement under the Uniform Commercial Code only if the filing...more

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