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Managing the Tax Impact of Debt Restructuring in the Wake of COVID-19

Many businesses are—or soon will be—unable to meet their obligations. Not all businesses in distress are unsuccessful; sometimes, as in the economic circumstances arising from the novel coronavirus (COVID-19) and the governmental directives tailored to address the related public health issues, even successful businesses must confront closures and steep declines in demand that could not have been anticipated, and may find it necessary or desirable to restructure their existing debt obligations.

USA, Insolvency & Restructuring, Tax, Weil Gotshal & Manges LLP, Coronavirus
Second Circuit decision improves PBGC’s position in chapter 11

On April 8, the Second Circuit Court of Appeals reversed the Bankruptcy Court and concluded that special ERISA “termination premiums” due PBGC are not contingent prepetition claims subject to discharge in a chapter 11 reorganization. Pension Benefit Guar. Corp. v. Oneida, Ltd., 2009 WL 929528 (2d Cir. April 8, 2009), rev’g Oneida Ltd. v. Pension Benefit Guar. Corp., 383 B.R. 29 (Bankr. S.D.N.Y., 2008).

USA, Employee Benefits & Pensions, Insolvency & Restructuring, Litigation, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Bankruptcy, Employee Retirement Income Security Act 1974 (USA), Debtor, Unsecured debt, Interest, Liquidation, Joint and several liability, Bankruptcy discharge, Pension Benefit Guaranty Corporation, Title 11 of the US Code, Pension Protection Act 2006 (USA), Second Circuit, United States bankruptcy court, US District Court for the Southern District of New York