A bankruptcy judge in the Southern District of New York recently held that section 546(e) of the Bankruptcy Code does not prevent a debtor’s creditors from bringing state-law fraudulent conveyance actions that challenge a leveraged buyout of the debtor. Weisfelner v. Fund 1 (In re Lyondell Chem. Co.), No. 10-4609 (REG), --- B.R. ----, 2014 WL 118036 (Bankr. S.D.N.Y. Jan. 14, 2014).

TheLehman Brothers bankruptcy court has determined that the contractually specified methodology for conducting the liquidation of a swap agreement is protected by the safe harbor provisions of the bankruptcy, even if the selected methodology would be more favorable to the non-defaulting counterparty than the liquidation methodology that would apply absent the bankruptcy.See Michigan State Housing Dev. Auth. v. Lehman Bros. Deriv. Prods. Inc. (In re Lehman Bros. Holdings Inc.), No. 08-13555, ---B.R.

The Seventh Circuit has explicitly adopted the Second Circuit’s broad interpretation of the terms “transfer” and “settlement payment” in the Bankruptcy Code’s safe harbor provisions. See Peterson v. Somers Dublin Ltd., No. 12-2463, --- F.3d ----, 2013 WL 4767495 (7th Cir. Sept.

The Ninth Circuit has joined the majority of Circuit Courts in holding that bankruptcy courts have the authority to recharacterize alleged debts as equity. See Official Comm. of Unsecured Creds. v. Hancock Park Capital II, L.P. (In re Fitness Holdings Int’l, Inc.), No. 11-56677, --- F.3d ----, 2013 WL 1800000 (9th Cir. April 30, 2013). In doing so, the appellate court has explicitly reversed the contrary precedent of In re Pacific Express, Inc., 69 B.R. 112, 115 (B.A.P. 9th Cir. 1986).

On Friday, the Washington Department of Financial Institutions closed North County Bank, headquartered in Arlington, Washington, and appointed the FDIC as receiver. As receiver, the FDIC entered into a purchase and assumption agreement with Whidbey Island Bank, headquartered in Coupeville, Washington, to assume all of the deposits of the failed bank.

On Friday, the Florida Office of Financial Regulationclosed Haven Trust Bank Florida, headquartered in Ponte Vedra Beach, Florida, and appointed the FDIC as receiver. As receiver, the FDIC entered into a purchase and assumption agreement with First Southern Bank, headquartered in Boca Raton, Florida, to assume all of the deposits of the failed bank.

On Friday, the Florida Office of Financial Regulation closed three bank subsidiaries of Bank of Florida Corporation: (1) Bank of Florida – Southeast, Fort Lauderdale, Florida; (2) Bank of Florida – Southwest, Naples, Florida; and (3) Bank of Florida –

On Friday, the Office of the Comptroller of the Currency closed Granite Community Bank, N.A., and appointed the FDIC as receiver.

On Friday, the Nevada Financial Institutions Division closed Sun West Bank, headquartered in Law Vegas, Nevada, and appointed the FDIC as receiver. As receiver, the FDIC entered into a purchase and assumption agreement with City National Bank, headquartered in Los Angeles, California, to assume all of the deposits of the failed bank.

Today, Washington Mutual, Inc. (WMI) announced a Global Settlement Agreement with J.P. Morgan Chase and the FDIC. Under the agreement, J.P. Morgan Chase will give WMI over $4 billion in WMI deposits in its former failed bank subsidiaries in exchange for over $6 billion in other assets. Also, the three parties will split two potential tax refunds worth a total of $5.6 billion.