When should debt be recharacterized as equity? The answer to this question will have an enormous impact upon expected recovery in bankruptcy since equity does not begin to get paid until all prior classes of claims are paid in full. In a recent unpublished opinion, the Fourth Circuit Court of Appeals provided some guidance on when and in what circumstances recharacterization is appropriate. The Court’s decision also serves as warning to purchasers of debt that they may not be able to hide behind the original debt transaction in a recharacterization fight.

The Third Party (Rights Against Insurers) Act 2010 (the “2010 Act”) finally comes into force on 1 August 2016.

The 2010 Act makes it easier for a third party to bring a claim against an insurer when the insured party has become insolvent. The 2010 Act will replace the Third Parties (Rights Against Insurers) Act 1930 (the “1930 Act”) and is designed to extend and improve the rights of third party claimants.

The Jevic Holding Corp. bankruptcy case is proving to be precedent setting.  In a prior post, we examined how the court had greatly increased the evidentiary burden on a party seeking to hold one company liable for the debts of another company under a “single employer” theory.  That ruling was seen as a boon for private equity firms who were oftentimes the target of Chapter 11 creditor

When can a bank be at risk of unknowingly receiving a fraudulent transfer? How much information does a bank need to have before it is on “inquiry notice”? A recent decision from the Seventh Circuit Court of Appeals highlights the risks that a bank takes when it ignores red flags and fails to investigate. This decision should be required reading for all lenders since, in the matter before the Seventh Circuit, the banks’ failure to investigate their borrower’s questionable activity caused the banks to lose their security and have their secured loans reduced to unsecured claims.

Did Trump win again? Yes, but this time it was not “The Donald” but was instead the casino operator Trump Entertainment Resorts, Inc.

Did Trump win again?  Yes, but this time it was not “The Donald” but was instead the casino-operator Trump Entertainment Resorts, Inc. (“Trump Entertainment”).

When can a bank be at risk of unknowingly receiving a fraudulent transfer?  How much information does a bank need to have before it is on “inquiry notice”?  A recent decision from the Seventh Circuit Court of Appeals highlights the risks that a bank takes when it ignores red flags and fails to investigate.

In re Sentinel Management Group – The Decision

Two days before Christmas, the Seventh Circuit Court of Appeals issued a ruling that is likely to have a dramatic impact in the highly-contested Caesars Entertainment bankruptcy case.  The decision may also give a green light to other debtors seeking to enjoin lawsuits brought against non-debtor affiliates.

In a prior post, we explored the risks of utilizing an involuntary bankruptcy petition as a litigation tactic.  That post examined a July 2015 decision from the Second Circuit Court of Appeals in the TPG Troy LLCbankruptcy case, in which the court held that when an involuntary bankruptcy petition is dismissed there is a presumption that costs and fees will be awarded irre

Is a debtor required to pay default rate interest when it reinstates a loan under a plan of reorganization? According to a recent Eleventh Circuit Court of Appeals decision, In re Sagamore Partners, Ltd., 2015 U.S. App. LEXIS 15382 (Aug. 31, 2015), the answer depends upon the underlying loan documents and applicable non-bankruptcy law.