Delaware Bankruptcy Court Intercreditor Decision Raises Claim Subordination Issues

Intercreditor agreements between secured creditors are intended to limit the potential for litigation and result in predictable commercial outcomes with respect to recoveries from collateral in enforcement actions and bankruptcies. Despite the extensive drafting efforts of sophisticated counsel to eliminate ambiguities in these agreements, the interpretation of intercreditor agreements has been the subject of substantial bankruptcy litigation.

Filed under:
USA, Delaware, Insolvency & Restructuring, Litigation, A&O Shearman, United States bankruptcy court
Authors:
Gus M. Atiyah , Bjorn Bjerke , Tomasz Kulawik , Joel Moss , Solomon J. Noh , Maura O’Sullivan , Ned S. Schodek , Fredric Sosnick , Michael Steinberg , Joshua W. Thompson , Ronan Wicks , Steven Sherman
Location:
USA
Firm:
A&O Shearman
Set-off and 'special accounts'

Published in The Deal, January 5, 2011

The recent decision in Bank of America, NA v. Lehman Brothers Holdings, Inc. (In re Lehman Brothers Holdings Inc., et. al.), No. 08-13555, Adv. Pro. No. 08-01753, 2010 Bankr. LEXIS 3867 (Bankr. S.D.N.Y. Nov. 16, 2010) has shone a 10,000-watt spotlight onto the scope of common law set-off in New York.

Filed under:
USA, New York, Banking, Insolvency & Restructuring, Litigation, Proskauer Rose LLP, Debtor, Collateral (finance), Waiver, Beneficiary, Debt, Common law, Bank of America, Lehman Brothers
Authors:
Joshua W. Thompson , Steven O. Weise
Location:
USA
Firm:
Proskauer Rose LLP