In This Subject:
Eighth Circuit Guidelines that Chapter Code’s Cap on Lease Injury Claims Applies to Fraudulent Switch Judgment
In Lariat Cos. v. Wigley (In re Wigley), 951 F.3d 967 (eighth Cir. 2020), the U.S. Court docket of Appeals for the Eighth Circuit reversed a chapter appellate panel determination and held that a person debtor’s joint legal responsibility with the guarantor of an actual property lease for a fraudulent switch judgment: (i) was not discharged on account of the lease guarantor’s prior chapter discharge; however (ii) was nonetheless capped beneath part 502(b)(6) of the Chapter Code. In response to the Eighth Circuit, the fraudulent switch judgment was “one step faraway from the breach of the lease, however [the debtor’s] legal responsibility outcomes from the breach of the lease, so the cap applies.” [read more …]
Oversecured Creditor’s Proper to Contractual Default-Charge Curiosity Allowed Below State Regulation
In In re Household Pharmacy, Inc., 614 B.R. 58 (B.A.P. eighth Cir. 2020), an Eighth Circuit chapter appellate panel reversed a chapter court docket’s order disallowing a secured creditor’s declare for curiosity on the default charge beneath the events’ contract utilizing a penalty-type evaluation usually utilized to liquidated damages provisions. In response to the panel, such an evaluation can’t be utilized to default curiosity provisions. The panel additionally held that the chapter court docket erred when it held that the default rate of interest was unenforceable primarily based on “equitable concerns.” [read more …]
Drive Majeure Clause Triggered by Pandemic Shutdown Order Partially Relieves Chapter 11 Debtor from Well timed Paying Postpetition Hire
In In re Hitz Restaurant Group, 2020 WL 2924523 (Bankr. N.D. Unwell. June three, 2020), the U.S. Chapter Court docket for the Northern District of Illinois held that, as a result of a authorities shutdown decree compelled a restaurant to droop on-premises eating, a pressure majeure clause within the restaurant’s lease partially relieved the debtor from paying postpetition hire. [read more …]
Increasing the Scope of the Chapter Secure Harbor for Securities Transactions
In Holliday v. Ok Street Energy Administration, LLC (In re Boston Producing LLC), 2020 WL 3286207 (Bankr. S.D.N.Y. June 18, 2020), the U.S. Chapter Court docket for the Southern District of New York held that: (i) part 546(e) of the Chapter Code preempts intentional fraudulent switch claims beneath state regulation as a result of the intentional fraud exception expressly included in part 546(e) applies solely to intentional fraudulent switch claims beneath federal regulation; and (ii) funds made to the members of restricted legal responsibility firm debtors as a part of a pre-bankruptcy recapitalization transaction have been protected against avoidance beneath part 546(e) as a result of the debtors have been “monetary establishments,” as prospects of banks that acted as their depositories and brokers in reference to the transaction. [read more …]
One other Chapter Court docket Joins the Majority Camp on Put up-Plan Affirmation Setoff
In In re Rogers Morris, 2020 WL 1321894 (Bankr. N.D. Miss. Mar. 16, 2020), the U.S. Chapter Court docket for the Northern District of Mississippi contributed to an current cut up among the many courts by becoming a member of the bulk view in holding creditor could train setoff rights after the affirmation of a plan in a chapter case. [read more …]
From the High in Transient: U.S. Supreme Court docket Chapter Roundup
In Monetary Oversight and Administration Board for Puerto Rico v. Aurelius Funding, LLC, No. 18-1334, 590 U.S. ___ (June 1, 2020), the Supreme Court docket rejected a constitutional problem to Congress’s scheme for addressing Puerto Rico’s fiscal disaster. The Court docket additionally lately denied petitions to assessment sure different high-profile bankruptcy-related rulings. [read more …]
Property Might Be Offered in Chapter Free and Away from Successor Legal responsibility
In In re Catalina Sea Ranch, LLC, 2020 WL 1900308 (Bankr. C.D. Cal. Apr. 13, 2020), the court docket joined nearly all of courts in holding that property might be offered to an insider of a debtor free and away from successor legal responsibility claims throughout the plain that means of part 363(f) of the Chapter Code. [read more …]
Bolstering the Majority Rule: Chapter Court docket Holds that Adjudication of Avoidance Legal responsibility Is Prerequisite to Disallowance of Transferee’s Declare Below Part 502(d)
In In re Southern Produce Distributors, Inc., 2020 WL 1228719 (Bankr. E.D.N.C. Mar. 11, 2020), the chapter court docket held that the declare of a recipient of an avoidable switch can’t be disallowed beneath part 502(d) of the Chapter Code, which disallows such claims except the transferee returns the transferred property to the property, till the transferee’s avoidance legal responsibility has been lastly adjudicated. [read more …]
Secured Creditor’s “Web Financial Damages” Estimate of Disputed Claims “Plainly Inadequate” to Set up Collateral Worth
In In re Montreal, Maine & Atlantic Railway, Ltd., 956 F.3d 1 (1st Cir. 2020), the U.S. Court docket of Appeals for First Circuit affirmed a ruling secured creditor did not fulfill its burden of building that collateral within the type of indemnification claims settled by the property had any worth entitled to sufficient safety. In response to the court docket, a displaying of attainable damages is just not sufficient with respect to a disputed declare. As an alternative, the creditor should set up the possible validity of the declare and the chance of restoration. [read more …]
Corinne Ball (New York) obtained the 2020 Lifetime Achievement Award from the New York Regulation Journal (“NYLJ“) for making “an affect on the authorized neighborhood and the follow of regulation over a whole profession.” The NYLJ introduced its 2020 awards on June 30, will characteristic the recipients in its upcoming Skilled Excellence Journal, and can honor them on the New York Authorized Awards on October 27, 2020. Ms. Ball has practically 40 years of expertise in enterprise finance and restructuring, with a concentrate on complicated company reorganizations and distressed acquisitions. She co-leads the New York Workplace of Jones Day’s Enterprise Restructuring & Reorganization Observe and leads the Agency’s European Misery Investing and Different Capital Initiatives. She additionally leads the Agency’s distressed M&A efforts and is the featured “Misery M&A” columnist for the NYLJ.
Fabienne Beuzit (Paris) and Isabelle Maury (Paris) have been acknowledged within the 2021 version of The Finest Attorneys in France™ within the subject of Insolvency and Reorganization Regulation.
Heather Lennox (Cleveland and New York) and Corinne Ball (New York) have been named “Main Attorneys” within the subject of “Finance—Restructuring (together with chapter): company” in The Authorized 500 United States 2020.
Dr. Olaf Benning (Frankfurt) was acknowledged within the 2021 version of The Finest Attorneys in Germany™ within the subject of Restructuring and Insolvency Regulation.
Bruce Bennett (Los Angeles and New York) was named a “Main Lawyer” within the fields of “Finance—Restructuring (together with chapter): company” and “Finance—Restructuring (together with chapter): municipal” in The Authorized 500 United States 2020.
An article written by Brett P. Barragate (New York) and Kay V. Morley (London) titled “Cross-Border Restructurings Case Research: syncreon” was the “characteristic story” within the Might 2020 concern of The Secured Lender.
Joshua Ok. Brody (New York) was named a “Subsequent Technology Accomplice” within the subject of “Finance: Restructuring (together with chapter): company” in The Authorized 500 United States 2020.
On April 28, 2020, Thomas M. Wearsch (Cleveland) gave a presentation titled “Anatomy of a Distressed Provider Scenario” to the Authorized Points Council of the Affiliation of Authentic Tools Suppliers at its annual assembly. On June 24, 2020, he gave a presentation relating to “Navigating the Minefield of Rising Company Governance Points in Advanced Restructurings” on the Affiliation of Insolvency and Restructuring Advisors’ annual convention.
An article written by Carl E. Black (Cleveland), Mark J. Andreini (Cleveland), and Jonathan Noble Edel (Cleveland) titled “Collectors on the Gate: How Good Are Your Indemnities and D&O Insurance coverage?” was printed within the June 2020 concern of Pratt’s Journal of Chapter Regulation.
An article written by Charles M. Oellermann (Columbus) and Mark G. Douglas (New York) titled “Use of Money Collateral to Pay Prepetition Debt Not Prohibited by Jevic” was printed within the June 26, 2020, concern of the Worldwide Regulation Workplace’s Insolvency and Restructuring Publication.
An article written by Dan T. Moss (Washington) and Heather Lennox (Cleveland and New York) titled “Momentary Suspension of Chapter Instances Throughout Pandemic” appeared within the Might 1, 2020, version of Bloomberg Regulation.
An article written by Corinne Ball (New York) titled “Launch and Waiver by an LLC Debtor of Its Affiliated Lenders Bars Subsequent Go well with” was printed within the June 24, 2020, version of the NYLJ.
An article written by Dan T. Moss (Washington) and Mark G. Douglas (New York) titled “Put up-Taggart, Ninth Circuit BAP Holds that No Truthful Floor of Doubt Normal Applies to Automated Keep Violations” was printed on Might 12, 2020, in Lexis Observe Advisor.