IE CA 3 Holdings Ltd and IE CA 4 Holdings Ltd (Companies) were two Canadian registered companies whose directors were located outside of Canada. The Companies’ parent company, Iris Energy Limited (Iris), was listed on NASDAQ and had its registered office in Melbourne and principal place of business in Sydney, with three of its six directors located in New South Wales.
In Morgan v McMillan Investment Holdings Pty Ltd [2024] HCA 33, the High Court had to consider whether a right to sue held by companies in liquidation could provide the required gateway for a pooling order under s 579E(1) of the Corporations Act 2001 (Cth).
Key Takeaways
In a case of first impression in the Ninth Circuit, the US Court of Appeals recently handed bankruptcy trustees a significant power by ruling in TheLovering Tubbs Trust v. Hoffman (In re O’Gorman) that a trustee can avoid intentionally fraudulent transfers under the Federal Bankruptcy Code, even if no creditor suffered harm as a result.
On August 28, 2024, Judge Gregory B. Williams of the US District Court for the District of Delaware issued a ruling in AIG Financial Products Corporation, Civ. No. 23-573, affirming an order on appeal from the Delaware Bankruptcy Court that denied a motion to dismiss a chapter 11 petition as a bad faith filing.
On July 19, 2024, Judge Michael Wiles of the US Bankruptcy Court for the Southern District of New York issued a ruling in In re Mercon Coffee Corporation, Case No. 23-11945, invalidating insider releases in a proposed chapter 11 plan on the basis that the releases were improper retention-related transfers.
Judge Wiles found that he could not approve the releases – even though the debtors had promised them and insiders had relied upon that promise – because the releases did not meet the strict requirements of Bankruptcy Code Section 503(c).
In In the matter of Academy Construction & Development Pty Ltd (subject to Deed of Company Arrangement) [2024] NSWSC 808, the New South Wales Supreme Court had to determine whether to terminate a Deed of Company Arrangement (DOCA) on the basis that it was oppressive, unfairly prejudicial or discriminatory.
Key Takeaways
The Supreme Court of Western Australia has recently delivered judgment in the case of Kitay v Frigger [No 2] [2024] WASC 113. The Court held that some, but not all, long-term costs agreements and retainers entered into by a liquidator required court approval.
Key Takeaways
Bankruptcy Code Section 502(b)(6) establishes a Statutory Cap on the damages a landlord can claim arising from the termination of a lease in bankruptcy case. Courts have split on how to calculate the Statutory Cap, whether and how to apply letters of credit to reduce the Statutory Cap, and whether the Statutory Cap applies to a landlord’s claims against a lessee’s debtor-guarantor.
On March 26, 2024, the US District Court for the Southern District of New York issued an opinion addressing the foregoing issues:
On March 15, 2024, the US Court of Appeals for the Seventh Circuit issued a ruling that broadly applied the “safe harbor” provision of section 546(e) of the Bankruptcy Code to insulate from state and federal fraudulent transfer attack certain transactions involving private securities. Petr, Trustee for BWGS, LLC v. BMO Harris Bank, N.A. and Sun Capital Partners VI, L.P., No. 23-1931, 2024 WL 1132170 (7th Cir. 2024). The court addressed two questions of first impression in the Seventh Circuit: