Introduction
Business Bankruptcy Filings
Public Company Bankruptcies
Notable Bankruptcy Rulings
Legislative Developments

Late in the evening on Feb. 23, 2021, the department store chain Belk Inc. and 17 affiliates filed prepackaged bankruptcy cases in the U.S. Bankruptcy Court for the Southern District of Texas. In addition to filing first-day motions, Belk also filed its disclosure statement and plan of reorganization, which already had been solicited and accepted by the vast majority of those entitled to vote.

On October 26, 2020, the U.S. Bankruptcy Court for the Southern District of Texas issued a long-awaited ruling on whether natural gas exploration and production company Ultra Petroleum Corp. ("UPC") must pay a make-whole premium to noteholders under its confirmed chapter 11 plan and whether the noteholders are entitled to postpetition interest on their claims pursuant to the "solvent-debtor exception." On remand from the U.S.

Introduction
Priority of Income Tax Claims
Affirmative Insurance
The Bankruptcy Court's Ruling
The District Court's Ruling
Outlook

In re Ultra Petroleum Corp. provides substantial support for the allowance of make-whole amounts pursuant to 11 U.S.C. § 502(b)(2) and that such are neither interest, unmatured interest nor the economic equivalent of unmatured interest. In re Ultra Petroleum Corp., No. 16-03272, 2020 WL 6276712, *3-*4 (Bankr. S.D. Tex. Oct. 26, 2020). The case also clarifies that bankruptcy courts may not permit a solvent debtor to ignore its contractual obligations to unimpaired classes of unsecured creditors.

Case Background

The ability of a bankruptcy trustee or chapter 11 debtor-in-possession ("DIP") to avoid fraudulent transfers is an important tool promoting the bankruptcy policies of equality of distribution among creditors and maximizing the property included in the estate.

One year ago, we wrote that the large business bankruptcy landscape in 2019 was generally shaped by economic, market, and leverage factors, with notable exceptions for disastrous wildfires, liabilities arising from the opioid crisis, price-fixing fallout, and corporate restructuring shenanigans.

The year 2020 was a different story altogether. The headline was COVID-19.

In the latest chapter of more than a decade of litigation involving efforts to recover fictitious profits paid to certain customers of Bernard Madoff's defunct brokerage firm as part of the largest Ponzi scheme in history, the U.S. Court of Appeals for the Second Circuit held in In re Bernard L. Madoff Investment Securities LLC, 976 F.3d 184 (2d Cir.

In 2019, the U.S. Court of Appeals for the Second Circuit made headlines when it ruled that creditors' state law fraudulent transfer claims arising from the 2007 leveraged buyout ("LBO") of Tribune Co. ("Tribune") were preempted by the safe harbor for certain securities, commodity or forward contract payments set forth in section 546(e) of the Bankruptcy Code. In In re Tribune Co. Fraudulent Conveyance Litig., 946 F.3d 66 (2d Cir. 2019), petition for cert. filed, No. 20-8-07102020, 2020 WL 3891501 (U.S.

The ability of a bankruptcy trustee or chapter 11 debtor-in-possession ("DIP") to obtain credit or financing during the course of a bankruptcy case is often crucial to the debtor's prospects for either maintaining operations pending the development of a confirmable plan of reorganization or facilitating an orderly liquidation designed to maximize asset values for the benefit of all stakeholders. In a chapter 11 case, financing (and/or cash infusions through recapitalization) also is often a key component of the reorganized debtor's ability to operate post-bankruptcy.