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Paddle 8 Creditors Battle Over Scope of New York Consignment Law

Since online auctioneer Paddle 8 filed for bankruptcy protection in March, creditors of the company have begun filing their notices of claim in the bankruptcy case. One thing on which the creditors all seem to agree is that the current assets of Paddle 8 will be insufficient to cover its debts by a considerable margin. Paddle 8’s lenders and commercial landlord are by far the largest creditors, and standing out from the crowd will be difficult.

United Kingdom, USA, Insolvency & Restructuring, Litigation, Sullivan & Worcester LLP, Landlord
Paddle 8 Bankruptcy a Harbinger in the Time of COVID19 and the Coming Art World Crisis

Early last week the online auctioneer Paddle 8 filed for Chapter 11 bankruptcy in the Southern District of New York, on the heels of a recent lawsuit demanding payment for works of art sold at a charitable auction last November.

Global, USA, New York, Banking, Insolvency & Restructuring, Litigation, Sullivan & Worcester LLP, Title 11 of the US Code
Further corporate governance reforms, including a possible review of the UK's dividend regime and improved training for directors

BEIS has just published the Government's response to its March 2018 consultation on "Insolvency and Corporate Governance" reforms (for our March alert on this, click

United Kingdom, Corporate Finance/M&A, Employee Benefits & Pensions, Insolvency & Restructuring, Baker McKenzie, Corporate governance, Dividends, Holding company
Super-priority claims for professional services related to restructuring plans and debt restructuring agreements?

With two decisions (No. 1895/2018 and No. 1896/2018), both filed on 25 January 2018, the Court of Cassation reached opposite conclusions in the two different situations

The case

Italy, Insolvency & Restructuring, Litigation, Nctm Studio Legale, Bankruptcy, Debt restructuring, Italian Supreme Court of Cassation
De facto partnerships can be declared bankrupt even if partners are corporations

The Constitutional Court (6 December 2017) confirmed that Art. 147, para. 5, of the Italian Bankruptcy Law does not violate the Constitution as long as it is interpreted in a broad sense

The case

Italy, Insolvency & Restructuring, Litigation, Nctm Studio Legale, Bankruptcy, Italian Supreme Court of Cassation
Contracts remain in force in amministrazione straordinaria even after they are expired ?

With the decision No. 1195 of 18 January 2018, the Court of Cassation ruled on the powers of the extraordinary commissioner to require performance of pending contracts and on the treatment of the relevant claims of the suppliers

The case

Italy, Insolvency & Restructuring, Litigation, Nctm Studio Legale, Italian Supreme Court of Cassation
The bankruptcy receiver can continue utilities contracts, but is not bound to pay in full previous claims based on such contracts

The Court of Cassation with a decision of 25 September 2017, No. 22274 confirms that Art. 74 of the Italian Bankruptcy Law provides a special rule, which does not apply to cases to which it is not explicitly extended

The case

Italy, Insolvency & Restructuring, Litigation, Nctm Studio Legale, Bankruptcy, Unsecured debt, Italian Supreme Court of Cassation
Claw-back of a corporate spin-off (Art. 2506 of the Italian Civil Code)?

With the decision No. 1649 of 19 September 2017 the Court of Appeals of Catania followed the interpretation according to which a spin-off is not subject to the avoiding powers of a bankruptcy receiver

The case

Italy, Insolvency & Restructuring, Litigation, Nctm Studio Legale, Bankruptcy, Liquidation
The EU recast Regulation on insolvency proceedings (No. 2015/848) and avoiding actions by the receiver

Applicable law

European Union, Italy, Insolvency & Restructuring, Litigation, Nctm Studio Legale, Court of Justice of the European Union
A new comprehensive reform of Italian insolvency proceedings: continuity and innovation

The Italian Government has been delegated to enact a comprehensive restatement of the whole set of rules of insolvency procedures, with specific innovative addresses regarding (to mention only the most important) the concordato preventivo procedure, venue rules, an out-of-court mediation alert process to timely address a risk of insolvency, new forms of security and a streamlined set of priorities among creditors

Introduction

European Union, Italy, Insolvency & Restructuring, Nctm Studio Legale, Bankruptcy, UNCITRAL, European Commission