After two years of being held virtually, ABI’s in-person Cross-Border Insolvency Program resumed on Nov. 14 in the Blank Rome LLP Conference Center in Manhattan. Thanks go to Evan Zucker and Blank Rome for hosting the conference. After an initial welcome from committee co-chairs Kyle Ortiz (Togut, Segal & Segal) and Evelyn Meltzer (Troutman Pepper), the program ran with four sessions and included the award of the first annual International Matter of the Year for the LATAM transaction, as well as an honorable mention for the Luckin Coffee transaction (details on both are separately addressed elsewhere in the newsletter).
The first panel discussed “Cryptocurrency and Cross-Border Insolvency Law.” Kyle Ortiz chaired the panel, which included speakers Christopher S. Koenig (Kirkland & Ellis - US), Grant Carroll (Ogier – BVI) and Jose Carles (Carles – Spain). The panel discussed the Three Arrows, Voyager and Celsius cases. A common theme as well is that regulators around the world are struggling to either create a legislative framework to address this new asset class, or try to deal with it using their traditional property law frameworks.
The second panel discussed cross-border recognition issues, with a particular focus on the Modern Land opinion that Hon. Justice Glenn issued on July 18 in Modern Land (China) Co. Limited. Evan Zucker chaired this panel, and the speakers were Christopher Levers (Ogier – Cayman), R. Craig Martin (DLA Piper – USA) and Cassandra Ronaldson (Interpath Advisory – Cayman). In Modern Land, Judge Glenn ruled that chapter 15 can be used to discharge a New York-governed law debt if the foreign court properly exercised its direction. This decision rejects the English Gibbs rule that holds that an English law debt can only be discharged in an English proceeding, not in a foreign proceeding, unless the creditor had attorned to the foreign jurisdiction. Discussion also focused on whether there has been a general shift away from jurisdiction of incorporation for the purposes of establishing COMI when confronting recognition applications. In the U.S., the concept of “letterbox” jurisdictions had long presented issues for recognition under chapter 15, and now it seems that courts in other jurisdictions such as Hong Kong and Singapore are not content with just relying on jurisdiction of incorporation to support a COMI finding.
The third panel was “View from the Bench,” which Steven Weisz (Cozen O’Connor – Canada) chaired and featured as panelists the Hon. Elizabeth S. Stong (E.D.N.Y.), Hon. Chief Justice Geoffrey B. Morawetz (Ontario Superior Court of Justice – Canada) and Hon. David S. Jones (S.D.N.Y.). Judge Strong provided an update on model law development at UNCITRAL and described the importance of consensus in the working of the committees as guidelines are developed. Chief Justice Morawetz discussed the question of whether recognition is an all-or-nothing proposition if certain provisions of the order being sought to be recognized are objectionable from the receiving court’s perspective. Judge Jones led a discussion around the use of foreign laws to assist in interpreting the provisions of chapter 15. The panel concluded with a discussion around the intersection of arbitration and bankruptcy proceedings.
The last panel of the day was a “Cross-Border Update.” R. Adam Swick (Akerman – US) chaired this panel, which included Hon. Leif M. Clark (Leif M. Clark Consulting – USA), Thomas S. Kessler (Cleary Gottlieb Steen & Hamilton LLP – USA), Paul Madden (Harneys – BVI) and Rachel B. Nicholson (Thornton Grout & Finnigan – Canada). This panel addressed a number of issues, including reverse vesting orders, arbitration and bankruptcy, the “Texas two-step,” the Alto Maipo case and the extent of the bankruptcy court’s personal jurisdiction, the LATAM decision, and some recent amendments to Cayman company legislation aimed at facilitating recognition of Cayman proceedings globally.
