Celsius’ retail borrowers finally have an answer on who owns the cryptocurrency they deposited into Celsius in exchange for a loan from Celsius – spoiler alert: on November 13, 2023 the bankruptcy court held that Celsius’ terms of service “clearly and unambiguously” gave Celsius ownership of retail borrowers’ cryptocurrency. The bankruptcy court’s decision follows its January 2023 decision which similarly held that the cryptocurrency of Celsius’ “Earn” customers also belonged to Celsius because the terms of service similarly unambiguously granted Celsius title ownership.

The liquidity-fueled lull in restructuring activity provides both an interesting historical echo of the late 1990s and a useful opportunity for market participants to take note of a deceptively interesting opinion in Giuliano ex rel. Consolidated Bedding, Inc. v. L&P Financial Services Co. (In re Consolidated Bedding, Inc.), Case No. 19-50727, 2021 WL 2638594 (Bankr. D. Del. June 25, 2021) (Shannon, J.).

In brief

The Federal Judiciary Council issued on April 27, 2020, the General Resolution 8/2020 on the Work Plan and Contingency Measures in the Jurisdictional Entities as a consequence of the Covid-19 Virus (the "Resolution").

The Resolution establishes that during the period from May 6 to May 31, 2020, only new requests, claims, ancillary proceedings and appeals, i.e. not previously filed, will be processed in urgent cases, regardless of whether they are filed physically or electronically.

On 23 June 2017, a reform to the Federal Criminal Code was enacted to classify the criminal offense of “illegal extrajudicial debt collection” established in article 284 Bis. 

The Mexican insolvency and bankruptcy law (“Ley de Concursos Mercantiles” or “LCM“) that came into effect on May 12, 2000, abrogated the Mexican Bankruptcy and Suspension of Payments Law. One of the stated purposes of the LCM was to mitigate the impact that globalization and the free market had on Mexican corporations, especially after ratification of the North American Free Trade Agreement in 1994. The LCM, therefore, seeks to preserve businesses facing a general default on the payment of their obligations and thereby preserve jobs in Mexico.

In early November, the Ninth Circuit held in In re New Investments, Inc. that a debtor was required to “cure” defaults to an agreement using a post-default interest rate, overturning its prior, decades-old decision In re Entz-White Lumber & Supply, Inc., which had held that a debtor could cure agreements at pre-default interest rates.

Background

Creditors seeking to file an involuntary petition against a debtor may want to consider doing their due diligence before using it as a tool in their ongoing disputes with a debtor.