We reported to you last month a significant development in the matter of In re TOUSA USA, when the United States District Court for the Southern District of Florida issued its opinion and order reversing the controversial holdings of the Bankruptcy Court in the TOUSA chapter 11 case as to the so-called “Transeastern Lenders,” a group of lenders who had previously been ordered to disgorge nearly ½ billion dollars received in repayment of indebtedness which the Court found constituted a fraudulent transfer under Sections 548 and 550 of the Bankruptcy Code.

On February 11, 2011, the United States District Court for the Southern District of Florida reversed the controversial decision of the Bankruptcy Court in In re TOUSA that required a group of lenders to disgorge nearly a half billion dollars in repayment of indebtedness which the Bankruptcy Court found constituted a fraudulent transfer under Sections 548 and 550 of the Bankruptcy Code.

1. Introduction

On 25 August 2010, the German government published a draft of an Act for the Restructuring and Orderly Liquidation of Credit Institutions, for the Establishment of Restructuring Fund for Credit Institutions and for the Extension of the Limitation Period of Corporate Law Management Liability (Restrukturierungsgesetz, the “German Restructuring Act”). It is anticipated that the German Restructuring Act will soon be introduced to the German parliament and be passed quickly.