The breadth and scope of the Bankruptcy Code’s automatic stay and the potential cost a company may face for violating the stay made national news last week in a dust-up between two telecom providers, when the U.S. Bankruptcy Court overseeing Windstream’s bankruptcy case ordered Charter Communications to pay Windstream more than $19 million in damages. The automatic stay is triggered immediately when a bankruptcy petition is filed.

In a highly-anticipated decision on a long-running bondholder dispute, the US Court of Appeals for the Second Circuit issued its judgment last week in Marblegate Asset Management LLC v Education Management Corp. It concluded that “Section 316(b) [of the US Trust Indenture Act 1939] prohibits only non-consensual amendments to an indenture’s core payment terms”, i.e. the amount of principal and interest owed and the maturity date.