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.).

A recent High Court decision considered the duty of Law of Property Act (LPA) receivers when selling secured property to an associated company of the creditor. The LPA receivers were chartered surveyors, appointed by the creditor in respect of a cider factory over which it had security and were alleged to have acted in bad faith by preferring the interests of the creditor over the interests of the debtor company.

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.

After a stream of successes for lenders in valuation claims against valuers in recent times, the recent success for a valuer in an application for summary judgment in the case of Tiuta International Ltd (in liquidation) v De Villiers Chartered Surveyors Ltd offers some comfort to valuers. It demonstrates the courts’ unwillingness to follow creative attempts by lenders to establish a cause of action by disregarding the established legal principles in respect of causation in valuation claims.