On New Year's Eve 2015, Swift Energy Company and 8 affiliates filed a voluntary petition commencing a prepackaged chapter 11 case in the United States Bankruptcy Court for the District of Delaware. The case is docketed as case no. 15-12670, and has been assigned to The Honorable Mary F. Walrath. The petition lists assets of $1.024 billion and liabilities of $1.349 billion.
Pursuant to Section 727 of the U.S. Bankruptcy Code, an individual Chapter 7 debtor may receive a discharge "from all debts that arose before the date of the order for relief under this chapter." A Chapter 11 or Chapter 13 debtor may receive similar relief pursuant to Sections 1141 and 1328(b), respectively. Under any chapter, this discharge serves the Bankruptcy Code's principal goal of relieving a debtor from his or her prepetition obligations and providing the debtor with a "fresh start" on emergence from bankruptcy.
Economists are renowned for their uncanny inclination to see dark clouds on a sunny day. Restructuring professionals tend to fall into the same camp; we’re no Pollyannas when it comes to forming views on business conditions. Perhaps working extensively with challenged companies tends to skew our outlook.
Since May, we’ve followed Solus v. Perry, a New York County Supreme Court case originally filed in July of 2012. The case centered around whether Perry entered into a binding oral agreement to sell Solus a participation interest in a $1.6 billion claim against Bernie Madoff’s bankruptcy estate.
“Claims arising from securities of a debtor’s affiliate should be subordinated” to all other “senior or equal” claims in the debtor’s bankruptcy case, held the U.S. Court of Appeals for the Second Circuit on Dec. 14, 2015. In re Lehman Brothers Inc., 2015 WL 8593604, at *3 (2d Cir. Dec. 14, 2015).
Bankruptcy often has a significant impact on the way a business operates. This makes sense, given that businesses going through the bankruptcy process have to figure out a way to make themselves viable after the process is complete. Oftentimes, part of what has to happen for a business to remain viable going forward after a bankruptcy is to sell off assets and portions of the business.
The U.S. Bankruptcy Court for the Middle District of Florida recently held that:
In analyzing the parameters surrounding a state law assignment for benefit of creditors, as well as the extent and limits of the powers of the assignee, the Eleventh Circuit inUllrich v. Welt (In re NICA Holdings, Inc.), 2015 WL 9241140 (11th Cir. 2015) held that an assignee for the benefit of creditors lacks the authority to file a bankruptcy petition on behalf of the assignee.
A decision by the Bankruptcy Court for the District of New Hampshire is the latest of a handful of cases in the past few years to weigh in on a circuit split as to whether a licensor of trademark rights can fully terminate a licensing agreement as a debtor in bankruptcy.
The U.S. Bankruptcy Court for the Middle District of Florida recently held that: