Introduction

In the August 2017 issue of Debt Dialogue, we discussed the recent decision by Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern District of New York with respect to claims brought by the litigation trust (the Trust) established in the bankruptcy case of LyondellBasell Industries AF S.C.A. (LBI) against Access Industries, Inc.

Section 546(e) of the Bankruptcy Code shields certain transfers involving settlement payments and other payments in connection with securities contracts (for example, payment for stock) made to certain financial intermediaries, such as banks, from avoidance as a fraudulent conveyance or preferential transfer. In recent years, several circuit courts interpreted 546(e) as applying to a transfer that flows through a financial intermediary, even if the ultimate recipient of the transfer would not qualify for the protection of 546(e).

On October 20, 2017, the United States Court of Appeals for the Second Circuit issued a decision which, among other things,[1] affirmed the lower courts’ holding that certain noteholders were not entitled to payment of a make-whole premium. The Second Circuit held that the make-whole premium only was due in the case of an optional redemption, and not in the case of an acceleration brought about by a bankruptcy filing.

On October 20, 2017, the United States Court of Appeals for the Second Circuit issued an important decision regarding the manner in which interest must be calculated to satisfy the cramdown requirements in a chapter 11 case.[1] The Second Circuit sided with Momentive’s senior noteholders and found that “take back” paper issued pursuant to a chapter 11 plan should bear a market rate of interest when the market rate can be ascerta

On October 3, 2017, Bankruptcy Judge Laurie Selber Silverstein of the United States Bankruptcy Court for the District of Delaware issued a decision holding that the Bankruptcy Court had constitutional authority to approve third-party releases in a final order confirming a plan of reorganization.

The U.S. Court of Appeals for the First Circuit recently overturned its own prior guidance to hold that an official creditors’ committee had an unconditional statutory right to intervene in an adversary proceeding. The First Circuit joined the Second and Third Circuits to recognize that the right to intervene provided by the Bankruptcy Code is not limited to the main bankruptcy case, contrary to the long-standing rule in the Fifth Circuit. However, the First Circuit also held that the scope of intervention may be qualified, with limits set by the trial court on a case-by-case basis.

Unlike an opinion, an order of the court is often not from the pen of the judge. Typically, a court order is submitted to the judge after negotiation among the parties. So, when a disagreement arises among the parties regarding the interpretation of the court’s order, how does the judge who signed the order go about resolving the matter? The issue came up not long ago in Outer Harbor Terminal LLC (Bkr. D. Del. May, 5, 2017), in which Judge Laurie Silverstein of the District of  Delaware bankruptcy court was confronted with a dispute over her own final DIP order.

In the May 2017 issue of Debt Dialogue, we discussed the recent decision by Judge Martin Glenn of the U.S.

Just one year after Lyondell Chemical Company (Lyondell) and Basell AF (Basell) consummated a nearly $20 billion merger of their businesses, the merged business of LyondellBasell Industries (LBI) “failed in a colossal manner.”1 As part of the bankruptcy process that followed, a court-appointed litigation trust (the Trust) filed suit for the benefit of unsecured creditors against numerous parties involved in the merger, bringing actual a