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US Bankruptcy Court Holds for Serta and Participating Lenders in Uptiering Transaction Dispute

On June 6, 2023, the US Bankruptcy Court for the Southern District of Texas (the “Court”) confirmed Serta Simmons Bedding, LLC’s (“Serta”) Chapter 11 plan and held that Serta’s 2020 uptiering transaction (the “Uptiering Transaction”) did not breach Serta’s 2016 first lien credit agreement (the “Credit Agreement”).

USA, Banking, Insolvency & Restructuring, Litigation, Mayer Brown, United States bankruptcy court, US District Court for Southern District of Texas
Continued Uncertainty Regarding Whether Companies in Bankruptcy Are Eligible for PPP Loans Under the US CARES Act

As discussed in earlier posts,1 substantial uncertainty exists over whether companies in bankruptcy are eligible to pursue funding pursuant to the SBA’s Paycheck Protection Program, or PPP, which was established by the CARES Act to support small businesses by offering SBA-guaranteed loans on advantageous terms.

USA, Banking, Insolvency & Restructuring, Litigation, Mayer Brown, Bankruptcy, Coronavirus, Paycheck Protection Program, CARES Act 2020 (USA)
Third Circuit Holds Bankruptcy Courts May Constitutionally Confirm a Chapter 11 Plan Containing Nonconsensual Third-Party Releases

On December 19, 2019, the US Court of Appeals for the Third Circuit held in In re Millennium Lab Holdings II, LLC1that bankruptcy courts have the constitutional authority, well within the constraints of Stern v.

USA, Healthcare & Life Sciences, Insolvency & Restructuring, Litigation, Mayer Brown, Medicare, Medicaid, Bankruptcy
US Bankruptcy Code Defines Right to Receive “Make-Whole” Premium under Chapter 11 Plan

On November 26, 2019, the US Court of Appeals for the Fifth Circuit held in Ultra Petroleum Corp. v.

USA, Insolvency & Restructuring, Litigation, Mayer Brown, Bankruptcy, Debtor, United States bankruptcy court
Intercreditor Agreements After Momentive: When a Hindrance Is Not a "Hindrance"

Intercreditor agreements--contracts that lay out the respective rights, obligations and priorities of different classes of creditors--play an increasingly important role in corporate finance in light of the continued prevalence of complex capital structures involving various levels of debt. When a company encounters financial difficulties, intercreditor agreements become all the more important, as competing classes of creditors seek to maximize their share of the company's limited assets.

USA, New York, Banking, Insolvency & Restructuring, Litigation, Mayer Brown, Bankruptcy, Secured creditor, Unsecured creditor, Uniform Commercial Code (USA), Second Circuit, United States bankruptcy court, US District Court for the Southern District of New York
US Supreme Court Reverses a Chapter 11 Structured Dismissal

Czyzewski v. Jevic Holding Corp., No. 15-649 (2017)

USA, Insolvency & Restructuring, Litigation, Mayer Brown, Supreme Court of the United States
UK High Court judgment on ISDA Default Rate calculations in Lehman Waterfall IIC, and supplemental judgment on statutory interest and currency conversion claims in Waterfall IIA and IIB

The High Court in London handed down judgment on Part C of the Lehman Waterfall II Application on 5 October 2016.

The judgment examines the extent of creditors’ entitlements to Default Rate interest on debts arising under ISDA Master Agreements governed by English law and New York law. As some £4.4 billion of LBIE’s admitted claims arise under ISDA Master Agreements and the debts were outstanding for more than five years, this judgment will materially influence the amount of money which must be applied in satisfaction of creditors’ entitlements to statutory interest.

United Kingdom, Banking, Derivatives, Insolvency & Restructuring, Litigation, Weil Gotshal & Manges LLP, International Swaps and Derivatives Association, Lehman Brothers
Bankruptcy Code—professional fees

Baker Botts L.L.P. v. ASARCO LLC, No. 14-103 (previously described in the October 2, 2014, Docket Report)

USA, Insolvency & Restructuring, Litigation, Mayer Brown
Bankruptcy—powers of bankruptcy courts

Wellness International Network, Ltd. v. Sharif, No. 13-935 (previously described in the July 1, 2014, Docket Report)

USA, Insolvency & Restructuring, Litigation, Mayer Brown, United States bankruptcy court
Bankruptcy Code—disposition of funds held by Chapter 13 trustee after conversion to Chapter 7

Harris v. Viegelahn, No. 14-400 (previously described in the December 15, 2014, Docket Report)

USA, Insolvency & Restructuring, Litigation, Mayer Brown, Debtor, Trustee