Introduction

Introduction

After much anticipation, the UK Supreme Court has handed down its judgment in BTI 2014 LLC v Sequana S.A. [2022] UKSC 25 - and has authoritatively set the baseline for how directors’ duties evolve as regards shareholders and creditors’ interests when a company is in the zone of insolvency.

Background

The full strength of the economic headwinds facing the UK economy is not yet clear, but a helpful recent report by insolvency and restructuring adviser Begbies Traynor provided some useful numbers around the attitudes of businesses.

The impact of Covid-19 is clearly the big talking point for 2022, with several questions arising: will new variants emerge, what steps will governments take to limit the spread, and what impact will it have on industries? To date, enforcement actions, insolvencies and restructurings have been relatively light, but with new restructuring legislation reforms on the horizon, and creditors starting to ramp up speed to enforcement, it appears likely that there will be an increase in winding up and cross-border restructuring work.

Beauty Brands, LLC, along with two subsidiaries and affiliates, has filed a petition for relief under chapter 11 in the Bankruptcy Court for the District of Delaware (Lead Case No. 19-10031).

Angel Medical Systems, Inc., a developer of medical devices based in Eatontown, NJ, has filed a petition for relief under Chapter 11 in the Bankruptcy Court for the District of Delaware (Case No. 18-12903).

Alcor Energy, LLC filed a petition for relief under Chapter 11 in the Bankruptcy Court for the District of Delaware (Case No. 18-12839).

White Eagle Asset Portfolio, LP, has filed a petition for relief under Chapter 11 in the Bankruptcy Court for the District of Delaware (Lead Case No. 18-12808).

Checkout Holding Corp. (dba Catalina Marketing), along with ten affiliates and subsidiaries, has filed a petition for relief under chapter 11 in the Bankruptcy Court for the District of Delaware (Lead Case No. 18-12794).