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 aggregate recovery is limited to the value of the property transferred. The U.S. Court of Appeals for the Second Circuit examined this rule in Jones v. Brand Law Firm PA (In re Belmonte), 931 F.3d 147 (2d Cir. 2019).

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 authorize the rejection of contracts regulated by the Federal Energy Regulatory Commission ("FERC"). Only a handful of courts have addressed this thorny issue to date, and with conflicting results in a controversy that may ultimately need to be resolved by the U.S. Supreme Court or legislative action.

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.

Among other things, new Federal Law No. 266-FZ (July 29, 2017) (the "Amendment") supersedes provisions concerning the vicarious liability of "controlling persons" for a bankrupt corporate debtor’s obligations set forth in RF Law No. 127-FZ on Insolvency (October 26, 2002) (the "Insolvency Law").

The Amendment defines a "controlling person" as any individual or entity who, during the three-year period preceding the existence of "signs of insolvency" or court approval of a bankruptcy petition, had the power to direct the debtor’s affairs, including the execution of contracts.

An important aspect of the Puerto Rico Oversight, Management, and Economic Stability Act, 48 U.S.C. §§ 2101–2241 ("PROMESA")—the temporary stay of creditor collection efforts that came into effect upon its enactment—was the subject of a ruling handed down by the U.S. Court of Appeals for the First Circuit. In Peaje Investments LLC v. García-Padilla, 845 F.3d 505 (1st Cir. 2017), the First Circuit affirmed in part and vacated in part a lower court order denying two motions for relief from the PROMESA stay.

In In re Abeinsa Holding, Inc., 2016 BL 335099 (Bankr. D. Del. Oct. 6, 2016), the U.S. Bankruptcy Court for the District of Delaware addressed what it perceived to be a flaw in the approach that many courts apply to motions for relief from the automatic stay.

In a historic decision with the potential to end 15 years of litigation between the Republic of Argentina and holdout bondholders from the financially strapped South American nation’s 2005 and 2010 sovereign debt restructurings, Judge Thomas Griesa of the U.S.

Greece

Despite the absence of any explicit directive in the Bankruptcy Code, it is well understood that a debtor must file a chapter 11 petition in good faith. The bankruptcy court can dismiss a bad faith filing "for cause," which has commonly been found to exist in cases where the debtor seeks chapter 11 protection as a tactic to gain an advantage in pending litigation. A ruling recently handed down by the U.S.

In In re Nuverra Environmental Solutions, Inc., 834 Fed. App'x 729 (3d Cir. 2021), the U.S. Court of Appeals for the Third Circuit handed down a long-awaited ruling that could have addressed, but ultimately did not address, the validity of "gifting" chapter 11 plans under which a senior creditor class gives a portion of its statutorily entitled recovery to one or more junior classes as a means of achieving consensual confirmation.