The Bankruptcy Code gives special protections to licensees of intellectual property when a debtor, as licensor, seeks to reject the license. However, the Bankruptcy Code does not include trademarks in its definition of “intellectual property.” So, are licensees of trademarks given any protection when debtors reject trademark licenses? If the Supreme Court grants a recent petition for writ of certiorari, we may get an answer.
The English High Court has sanctioned a scheme of arrangement for Algeco Scotsman PIK SA, a Luxembourg-incorporated company, after the creditors consented to the New York governing law and jurisdiction clause being altered in favour of the jurisdiction of the English courts. The issues discussed were:
- the fair representation of a class of creditors;
- cross-jurisdictional schemes; and
- early tender fees offered to creditors.
Background
As they say, what one hand giveth, the other hand taketh. In its recent decision in In re MPM Silicones, LLC, the U.S. Court of Appeals for the Second Circuit addressed make-whole premiums and cramdown rates of interest (among other issues not addressed here), issuing rulings that will impact creditors and debtors alike.
UK lawyers and restructuring professionals have been highlighting their concerns for British business and Financial Markets if the Government is unable to negotiate a bespoke treaty between the UK and the EU to preserve the mutual and reciprocal recognition provisions written into the Recast EU Insolvency Regulation (Recast EIR) and the Recast Brussels Regulation (the Judgements Regulation) after Brexit in 2019.
Do a lessee’s possessory interests in real property survive a “free and clear” sale of the property under section 363 of the Bankruptcy Code? In a recent decision, the Ninth Circuit Court of Appeals said “no,” holding that section 365(h) did not protect the interest of the lessee in the context of a section 363 sale when there had been no prior formal rejection of the lease under section 365.
In a corporate world where the capital structures of companies are becoming increasingly complex, schemes of arrangements under the Companies Act 2006 have established themselves as the restructuring procedure of choice for many distressed companies. This popularity is evidenced by the fact that schemes of arrangement have been increasingly used by overseas companies wishing to restructure their debts under the flexibility offered by English law.
Recently, the bankruptcy court presiding over the Energy Futures chapter 11 case issued an opinion analyzing the interplay between an intercreditor agreement’s distribution waterfall and payments to be made under the debtors’ multi-step reorganization plan. The court rejected a secured creditor’s argument that the intercreditor agreement’s distribution waterfall was triggered by one step of that reorganization.
Regulation (EU) 2015/848 of the European Parliament and of the Council of 20 May 2015 on insolvency proceedings comes into effect on 26 June 2017 for insolvency proceedings that are opened on or after that date. The Recast Regulation replaces the EC Regulation (1346/2000) on insolvency proceedings and has direct effect in the UK until such time as the UK leaves the EU.
The Insolvency Rules (England and Wales) 2016 (“IR2016”) came into force on 6 April 2016 applying to most corporate and personal insolvency regimes in England and Wales. However, there is still unfinished business for the Government and further regulation is expected to be introduced later this year to ensure the changes apply uniformly in all areas.
The European Association of Certified Turnaround Professionals (EACTP) organized an evening of debate about the proposed new European Directive on business insolvency held in Brussels on May 2nd at the offices of Squire Patton Boggs. Salla Saastamoinen, the European Commission Director of the Civil and Commercial Justice Unit, attended the event called A New European Restructuring Regime in a Changing World and met turnaround professionals from across Europe.