On April 23, 2019, the United States District Court for the Southern District of New York, in fraudulent transfer litigation arising out of the 2007 leveraged buyout of the Tribune Company,1 ruled on one of the significant issues left unresolved by the US Supreme Court in its Merit Management decision last year.
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.
On January 17, 2017, in a long-awaited decision in Marblegate Asset Management, LLC v. Education Management Finance Corp.,1 the US Court of Appeals for the Second Circuit held that Section 316 of the Trust Indenture Act ("TIA") does not prohibit an out of court restructuring of corporate bonds so long as an indenture's core payment terms are left intact.
On December 5, 2013, Judge Steven Rhodes of the US Bankruptcy Court for the Eastern District of Michigan held that the city of Detroit had satisfied the five expressly delineated eligibility requirements for filing under Chapter 9 of the US Bankruptcy Code1 and so could proceed with its bankruptcy case.
FSA has published an undertaking Legal & General has given under the Unfair Terms in Consumer Contracts Regulations (UTCCR), in relation to its home insurance policies. It held that certain critical expressions in the policy were potentially so wide that it was hard for a customer to know what was excluded. The insurer agreed to make its wording easier to understand. (Source: FSA Publishes Insurance UTCCR Undertaking)
BIS and Treasury have published their response to the consumer credit elements of the Government review of consumer credit and personal insolvency. The response explains the initiative that will ensure that over 85% of customers with personal current accounts will see clearer, fairer and more manageable charges for unarranged overdrafts. Customers will be able to get alerts when their balance is low and will not incur a fee if they exceed their limit by a small amount. Also, from late 2013 there will be guaranteed account switching within seven days.
FSA has published three consultation papers on the Retail Distribution Review (RDR). The papers cover:
FSA has set out its standards for “key attributes” of effective resolution regimes. The standards require each jurisdiction to:
CEIOPS holds annual conference: CEIOPS has held its annual conference. The event included a panel session on Solvency II and discussion by Sharon Bowles of the new European Supervisory Authorities.