While the Judge-made doctrine of equitable mootness continues to beguile and often stymie parties-in-interest seeking to appeal an order confirming a chapter 11 plan (as well as other orders which are on appeal prior to confirmation of a plan), appellants in the Fifth Circuit can continue to rest assured that the doctrine will be applied only as a “scalpel rather than an axe.” That is because in the Fifth Circuit, the doctrine—which can be described as a form of appellate abstention—is applied only on a claim-by-claim, instead of appeal-by-appeal basis.
In the first of our short videos in relation to business recovery and resilience, John Alderton (Partner in our Restructuring & Insolvency team), responds to the question:
‘There hasn’t been a wave of insolvencies, is business stress still there or are we through the worst of it?’
Please click here to listen to John’s answer.
We have written many times over the past few years about how the bankruptcy courts are off-limits to state-legalized cannabis businesses. This past year brought no new relief to the cannabis industry, and the doors to the bankruptcy courts remain shut. Are the other federal courts off-limits as well? A recent district court decision from the Southern District of California sheds some light on this issue, and indicates that the district courts are at least partially open to participants in legal cannabis businesses.
Factual Background
We discussed the announcement that Bulb Energy Ltd (“Bulb”) was due to be placed into special administration in our previous blog outlining how the rules for energy supply companies work, the supplier of last resort (“SoLR”) regime and what energy supply company special administration entails.
As has been widely reported, the recent energy price volatility (coupled with the price cap limiting suppliers’ ability to pass increased costs on to consumers) has caused a number of energy supply company failures. Yesterday saw the announcement of the collapse of Bulb, one of the UK’s largest energy suppliers, with it being due to be placed into special administration very shortly.
This is the first energy special administration we’ve seen. So how are the insolvency rules different for energy companies? What is a special administration, and why is this the first one?
Here we go again – proposed bankruptcy venue legislation is back after previous “reform” efforts came up empty. For those seeking legislative action, what are the chances for venue reform now?
Further to our blog last week regarding the restrictions on presentation of winding-up petitions being (partially) lifted, the legislation replacing the existing restrictions on presenting winding-up petitions has now been passed and is due to come into force on 29 September 2021.
On Monday, Zacaroli J handed down his eagerly anticipated judgment in Lazari Properties (2) Limited (and others) v New Look Retailers Limited (and others).
The New Look landlords challenged the New Look CVA and raised a number of arguments which some believed could be the end of CVAs as we know them. In particular, the New Look landlords argued that CVAs had gone far beyond the use for which they had been intended and sought to challenge the jurisdictional basis upon which some CVAs are implemented.
The key arguments were that:
In 2020, bankruptcy court doors continued to be shut to cannabis companies. Perhaps most troubling is the continued bar for companies that are only tangentially involved in the state-legalized cannabis industry. Although outlier cases exist, and even though courts have hinted that bankruptcy may be appropriate for some cannabis-related individuals and companies in some situations, there is a consensus now that bankruptcy is generally not available to individuals and companies engaged, directly or indirectly, in the cannabis industry.
The case of Arlington Infrastructure Ltd (In Administration) v Woolrych [2020] EWHC 3123 (Ch) is a cautionary reminder to qualifying floating charge holders (and their advisors) to review the terms of all security documents, before seeking to appoint an administrator.