Funds passing through a correspondent bank account in New York can create personal jurisdiction over the funds’ recipient, ruled the United States District Court for the Southern District of New York.  In Official Committee of Unsecured Creditors of Arcapita Bank B.S.C. v.

Practitioners that exclusively represent clients in large scale restructurings and chapter 11 reorganizations may be used to the debtor remaining in place with senior management continuing to oversee the day to day operations of the company and overseeing the debtor’s reorganization case.  It may seem strange then to such practitioners that, unlike in chapter 11 cases, the debtor in a chapter 7 case often has only a limited role in its own bankruptcy case after the initial debtor interview and the section 341 meeting of creditors.  In a chapter 7 case, a trustee is appointed and i

Now that we’ve recovered from the balmy holidays, survived a record snowstorm in New York, eaten way too many snacks at Super Bowl parties, wished everyone a Happy Year of the Monkey, enjoyed two long weekends, and debated the effects of the passing of Justice Scalia, it’s time to settle back down to business and take the rest of this short week to catch up on what you may have missed in the Weil Bankruptcy Blog so far this year. 

Bankruptcy Code Preempts McCarran-Ferguson Act in Dispute Over Courts’ Jurisdiction

A foreign company makes a foreign distribution to foreign shareholders shortly before merging with a U.S. company in a highly-leveraged LBO.  The resulting company files a chapter 11 petition in the United States Bankruptcy Court for the Southern District of New York 13 months later.  Can the foreign transfer be avoided as a fraudulent conveyance under section 548 of the Bankruptcy Code?  Previously, the answer was almost certainly not (at least in the Southern District of New York).

“Desperate times call for desperate measures” is often a rallying cry to justify harsh actions taken during times of panic and uncertainty which, in retrospect, are regrettable.  To protect against such adverse consequences in bankruptcy, there are and should be safeguards in place to prevent creditors from imposing unreasonable restrictions on a debtor at the immediate onset of an involuntary case.  In 

The law governing postpetition interest in bankruptcy remains unsettled despite having been subjected to more than 100 years of debate in the federal courts. On October 30, 2015, 

It has long been the case that secured creditors could be charged for the reasonable and necessary costs incurred to preserve the value of their collateral.  This equitable principle emerges out of case law that predates not only the current Bankruptcy Code, but also its immediate predecessor, the Bankruptcy Act of 1938.  As now codified in section 50

Over the course of almost a decade of litigation as part of an individual debtor’s chapter 7 bankruptcy case, the bankruptcy judge, in In re Tucker, made “half a dozen or so” comments about the debtor’s demeanor, credibility, and litigation strategy, including referring to the debtor as a “crook,” “dirty bird,” and a “skillful manipulator.”  The debtor filed a motion for recusal, arguing the judge

Two recent decisions from the District Court for the Southern District of New York have renewed interest in the Trust Indenture Act and the ability of minority bondholders to use it as a shield to protect their rights in an out-of-court nonconsensual restructuring:  Marblegate Asset Management, LLC v.

When a contract is called a lease and has some characteristics of a lease, but operates to grant the lessee the exclusive right to mine and remove coal from the premises, how should the contract be treated in bankruptcy?  In a