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Supreme Court Holds That Presence of Financial Conduits Does Not Trigger “Safe Harbor” Protection for Securities-Related Transfers Under Section 546(e) of the Bankruptcy Code

On February 27, 2018, the United States Supreme Court resolved a circuit split regarding the proper application of the safe harbor set forth in section 546(e) of the Bankruptcy Code, a provision that prohibits the avoidance of a transfer if the transfer was made in connection with a securities contract and made by or to (or for the benefit of) certain qualified entities, including a financial institution.

USA, Insolvency & Restructuring, Litigation, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Supreme Court of the United States
Ninth Circuit Holds That Joint Plan Covering Multiple Debtors Must Be Approved by Only One Impaired Class Per Plan, Not One Impaired Class Per Debtor

The Court of Appeals for the Ninth Circuit recently held that section 1129(a)(10) of the Bankruptcy Code – a provision which, in effect, prohibits confirmation of a plan unless the plan has been accepted by at least one impaired class of claims – applies on “per plan” rather than a “per debtor” basis, even when the plan at issue covers multiple debtors. In re Transwest Resort Properties, Inc., 2018 WL 615431 (9th Cir. Jan. 25, 2018). The Court is the first circuit court to address the issue.

USA, Insolvency & Restructuring, Litigation, Paul, Weiss, Rifkind, Wharton & Garrison LLP, Ninth Circuit
Setoff and Recoupment in Bankruptcy: A Brief Overview

This article provides a brief overview of the somewhat related doctrines of setoff and recoupment in the Chapter 11 context. Setoff is recognized in the Bankruptcy Code to offset the claims of creditors and the debtor in a bankruptcy proceeding. Recoupment is a common law doctrine of similar effect. Sometimes overlooked by debtors and creditors alike, these doctrines can be of critical consequence in the settling of accounts between a creditor and the bankrupt debtor.

Setoff

USA, Insolvency & Restructuring, Litigation, Kramer Levin Naftalis & Frankel LLP
Refusing to Fund Into a Bankruptcy: Lessons From Lyondell for Lenders

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

USA, Banking, Insolvency & Restructuring, Litigation, Kramer Levin Naftalis & Frankel LLP
Jevic - The Supreme Court Puts the “Dis” in Structured Dismissals

In a much anticipated decision issued on March 22, 2017, the United States Supreme Court determined in Czyzewski v. Jevic Holding Corp. (Jevic) that a “structured dismissal” of a bankruptcy case cannot include a distribution scheme to creditors that does not comply with the priorities provided for under the Bankruptcy Code. The decision looks at the policy underlying “basic priority rules” in bankruptcy cases and, in doing so, throws into question the future use of negotiated settlements in bankruptcy cases where some, but not all, creditors receive a benefit.

USA, Insolvency & Restructuring, Litigation, Kramer Levin Naftalis & Frankel LLP, Supreme Court of the United States, Third Circuit
Restructuring Department Bulletin - December 2025
USA, Insolvency & Restructuring, Litigation, Paul Weiss Rifkind Wharton & Garrison LLP, Insolvency, Supreme Court of the United States