The Seventh Circuit has reversed the district court’s decision in the Sentinel matter and ruled that the Bankruptcy Court’s allowance of a pre-petition transfer and authorization of a post-petition transfer of assets by Sentinel to its FCM customers was permitted under the Bankruptcy Code. The District Court had previously avoided the $22.5 million pre-petition transfer of funds to FCM customers and the $297 million post-petition transfer of funds authorized by the Bankruptcy Court.
In Re: Katherine Elizabeth Barnet, No. 13-612 (2d Cir. Dec. 11, 2013) [click for opinion]
Tenth Circuit holds that Canadian nationals who conspire to commit a breach of fiduciary duty against a Delaware corporation operating exclusively in Oklahoma are subject to personal jurisdiction in Oklahoma despite their lack of physical contact with the state. Canadian law firm alleged to have assisted the conspirators is not, however, subject to personal jurisdiction.
In re Vitro, S.A.B. de C.V., No. 11-33335-HDH-15 (Bankr. N.D. Tex. June 13, 2012)
Sec. Investor Prot. Corp. v. Bernard L. Madoff Inv. Secs., 474 B.R. 76 (2012)
The trustee for the Securities Investor Protection Act ("SIPA") liquidation of Bernard L. Madoff Investment Securities LLC ("BLMIS") filed a complaint in the bankruptcy court against Maxam Absolute Return Fund Ltd. ("Maxam"), seeking the return of about $100 million distributed to Maxam by BLMIS. Maxam answered the complaint and then sued the trustee in the Cayman Islands seeking a declaration that it was not required to return the money.
Yesterday, the United States Supreme Court held that sales of assets pursuant to chapter 11 plans must permit credit bidding by their secured lenders in order to satisfy the requirements for confirmation of a chapter 11 “cramdown” plan.1
Secured lenders have had long-held expectations of certain protections in the event the borrower files for bankruptcy.
In re: Qimonda AG, No. 09-14766-SM, Bankr. E.D. Va. (Oct. 28, 2011) [click for opinion]
Need to know
In a first for the US and Australian markets, the Buccaneer Energy group of companies successfully had bankruptcy plans approved by the US Bankruptcy Court for both US and Australian incorporated debtor companies.
"Once in a generation" review
Shortly before the Christmas break, the much anticipated review of the United States "Chapter 11 bankruptcy" regime was published by the American Bankruptcy Institute (ABI). This is one of very few such major "root and branch" reviews of Chapter 11 since its enactment in 1978, and the first since the 1990s.