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Will We Have New Rules for Corporate Bankruptcies? Recently Proposed Legislation That Could Reform Chapter 11 Practice

Overview

USA, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, US Congress
No Setoff Here: Third Circuit Resolves Triangular Setoff Debate Once and for All

Introduction

USA, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP
Delaware Bankruptcy Court Weighs in: Debtors Are Not Excluded From Bankruptcy Code’s Definition of “Financial Participant” and Safe Harbor

Introduction

USA, Delaware, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP
syncreon’s Financial Restructuring Implemented by Landmark English Schemes of Arrangement with Parallel Chapter 15 and CCAA Recognition

syncreon Group Holdings B.V. (the “Company” and together with its subsidiaries, “syncreon”) completed its landmark financial restructuring today. As has been widely reported, syncreon’s reorganization is perhaps the first-ever use of an English scheme to restructure debt issued by a U.S.-based global enterprise. This also appears to be the first time that CCAA recognition of an English scheme has been granted.

The Restructuring

USA, Company & Commercial, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP
A Check is Transferred When It’s Honored, Not Delivered

Readers familiar with contract law undoubtedly know the “mailbox rule,” that an offer is accepted the moment a document goes in the mail.1 The United States Bankruptcy Appellate Panel for the Ninth Circuit (the “BAP”) recently dealt with its own variant of the mailbox rule: does the issuance of a check constitute a transfer of estate assets on the date the check is delivered or on the date it is honored?

USA, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, Ninth Circuit, Bankruptcy Appellate Panel
Whirlpool Corporation v. HHGreg, Inc. (In re HHGregg, Inc.)

(Bankr. S.D. Ind. Dec. 4, 2017)

The bankruptcy court grants the motion to dismiss, finding the defendant’s security interest in the debtor’s assets, including its inventory, has priority over the plaintiff’s reclamation rights. The plaintiff sold goods to the debtor up to the petition date and sought either return of the goods delivered within the reclamation period or recovery of the proceeds from the sale of such goods. Pursuant to 11 U.S.C. § 546(c), the Court finds the reclamation rights are subordinate and the complaint should be dismissed. Opinion below.

USA, Insolvency & Restructuring, Litigation, Stoll Keenon Ogden PLLC, Debtor, United States bankruptcy court
In re Dickson

(Bankr. E.D. Ky. Nov. 22, 2017)

USA, Kentucky, Insolvency & Restructuring, Litigation, Stoll Keenon Ogden PLLC
Bankruptcy opinions within a day or two of issuance from the Western and Eastern Districts of Kentucky, the Northern and Southern Districts of Indiana, the Sixth and Seventh Circuits, and the U.S. Supreme Court

(B.A.P. 6th Cir. Nov. 28, 2017)

The Sixth Circuit B.A.P. affirms the bankruptcy court’s dismissal of the Chapter 12 bankruptcy case. The court finds that the bankruptcy court failed to give the debtor proper notice and opportunity to be heard prior to the dismissal. However, the violation of due process was harmless error. The delay in filing a confirmable plan and continuing loss to the estate warranted the dismissal. Opinion below.

Judge: Preston

Attorney for Appellant: Heather McKeever

USA, Insolvency & Restructuring, Stoll Keenon Ogden PLLC, Bankruptcy, Supreme Court of the United States, United States bankruptcy court, Sixth Circuit, Seventh Circuit
Cox v. Specialty Vehicle Solutions, LLC

(6th Cir. Nov. 14, 2017)

USA, Insolvency & Restructuring, Litigation, Stoll Keenon Ogden PLLC, Sixth Circuit
In re Wilson

(Bankr. W.D. Ky. Nov. 1, 2017)

The bankruptcy court grants the creditor’s motion for stay relief to proceed with a state court foreclosure action. The creditor had obtained an order granting stay relief in a prior bankruptcy filed by the debtor’s son, the owner of the property. The debtor’s life estate interest in the property does not prevent the foreclosure action from proceeding. Opinion below.

Judge: Lloyd

Attorney for Debtor: Mark H. Flener

Attorney for Creditor: Bradley S. Salyer

USA, Insolvency & Restructuring, Litigation, Stoll Keenon Ogden PLLC