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Yeah, We Can Take It - Texas Bankruptcy Court Defines the Scope of Its Post-Confirmation Jurisdiction

Executive Summary

A recent decision from the United States Bankruptcy Court for the Northern District of Texas, In re Care Ctrs., LLC, No. 18-33967, 2020 Bankr. LEXIS 3205 (Bankr. N.D. Tex. Nov. 12, 2020), examined (1) the scope of bankruptcy court subject-matter jurisdiction for post-confirmation actions filed in state court and removed to bankruptcy court; and (2) when the court must or should abstain and remand a proceeding back to the court where the action was originally brought.

USA, Texas, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP
Eastern District of Virginia Bankruptcy Court Finds Landlord’s Lender Has No Right to Enforce Landlord’s Lease with Bankrupt Retailer

OVERVIEW

USA, Insolvency & Restructuring, Litigation, Real Estate, Weil Gotshal & Manges LLP, Coronavirus
Third Circuit Decision Provides New Guidance on the Unfair Discrimination Standard of Cramdown and the Enforcement of Subordination Agreements When Confirming Cramdown Plans

In an important decision issued at the end of August, the United States Court of Appeals for the Third Circuit, in In re Tribune Co., Case No. 18-2909 (3d Cir. Aug. 26, 2020), held that subordination agreements need not be strictly enforced when confirming a chapter 11 plan pursuant to the Bankruptcy Code’s cramdown provision in section 1129(b)(1). In its decision, the Third Circuit also encouraged bankruptcy courts to apply “a more flexible unfair-discrimination standard” and set forth eight guiding principles to aid in that effort.

USA, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, Title 11 of the US Code
A strong statement - Hong Kong court says arbitration agreement is "irrelevant" to the exercise of courts discretion in a winding-up

Another Hong Kong court decision has questioned whether the judgment in the leading case of Lasmos Limited v. Southwest Pacific Bauxite (HK) Limited [2018] HKCFI 426, may have gone too far when it suggested that an arbitration clause in an agreement should generally take precedence over a creditor's right to present a winding-up petition.

Hong Kong, Arbitration & ADR, Insolvency & Restructuring, Litigation, Hogan Lovells, Arbitration clause, Good faith
Fraudulent Transfer Claims Avoid State Sovereign Immunity, But Only If a Property Interest Exists Under State Law

In a recent decision, In re Philadelphia Entertainment and Development Partners, L.P., No. 14-000255-mdc (Bankr. E.D. Pa. Dec. 31, 2019), the Bankruptcy Court for the Eastern District of Pennsylvania held that state sovereign immunity does not prevent bankruptcy courts from hearing fraudulent transfer claims against states.

USA, Pennsylvania, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, Debtor
Covenant of Good Faith and Fair Dealing Examined: La Paloma

On January 13, 2020, the United States Bankruptcy Court for the District of Delaware issued an opinion in In re La Paloma Generating Company, LLC., Case No. 16-12700 [Adv. Pro.

USA, Delaware, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, Debtor, United States bankruptcy court
Supreme Court Will Tell Us Soon if Creditor Violates Automatic Stay by Passively Retaining Debtor’s Property

The United States Supreme Court has granted certiorari on an issue that has greatly divided Circuit Courts of Appeal – the question of whether an entity that retains possession of a debtor’s property has an affirmative obligation to return that property to the debtor or trustee immediately upon the filing of the bankruptcy petition or risk being in violation of the automatic stay.

USA, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, Debtor, Supreme Court of the United States
Denial of Stay Relief is a Final Order, Says the U.S. Supreme Court

The Supreme Court, in Ritzen Group, Inc. v. Jackson Masonry, LLC,1 issued an unanimous opinion last week, ruling that the Court of Appeals for the Sixth Circuit correctly denied the ability of creditor Ritzen Group Inc.

USA, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, United States bankruptcy court
A welcome red packet - Hong Kong court recognizes mainland Chinese administrators for first time

Just in time for the Chinese New Year, a Hong Kong court has taken a major step forward in the developing law on cross-border insolvency by recognizing a mainland Chinese liquidation for the first time. In the Joint and Several Liquidators of CEFC Shanghai International Group Ltd [2020] HKCFI 167, Mr. Justice Harris granted recognition and assistance to mainland administrators in Hong Kong so they could perform their functions and protect assets held in Hong Kong from enforcement.

Hong Kong, Insolvency & Restructuring, Litigation, Hogan Lovells, Debtor, Investment funds, House of Lords
Delaware District Court Affirms Decision Holding Triangular Setoffs Are Not Permitted

The United States District Court for the District of Delaware recently affirmed a Delaware bankruptcy court case that held that the mutuality requirement of section 553(a)1The case declined to find mutuality in a triangular setoff between the debtor, a parent entity that owed the debtor money, and that entity’s subsidiary, which was a creditor.2

USA, Delaware, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, Debtor, US District Court for District of Delaware