Many litigators and corporate lawyers view the practice of representing a large shareholder and the company in which it is invested as common practice. In many instances, no conflict of interest will ever materialize such that the shareholder and the company require separate representation. However, in a recent opinion rendered by the United States Bankruptcy Court, Eastern District of Virginia (the “Court”), a large international law firm (the “Firm”) was disqualified from representing Enviva Inc.
While gaining recognition of Canadian insolvency proceedings south of the border used to be wishful thinking for an insolvent Canadian entity having involvement in the cannabis industry, such proceedings are now seemingly becoming a potential option. The United States Bankruptcy Court Central District of California Los Angeles Division (the “Court”) recently dismissed the United States Trustee’s (the “Trustee”) second motion to dismiss in The Hacienda Company, LLC’s (“THC”) bankruptcy proceedings.
Introduction
A few weeks ago, real estate practitioners, investors, speculators, lenders and aspiring homeowners were all surprised to learn that The One, a monster development at 1 Bloor St. West in Toronto, was being placed into receivership. The project undertaken by Sam Mizrahi and his company, Mizrahi Inc., is slated to be an 85-storey mixed-use residential tower in the heart of the city, comprising retail stores, a restaurant, a hotel and luxury residential suites. It would be an iconic addition to Toronto’s growing skyline…
A recent Canadian insolvency filing could provide insight into how U.S. courts will approach Chapter 15 applications from foreign cannabis-related entities.
There may be hope on the horizon for insolvent Canadian cannabis companies who wish to seek recognition proceedings south of the border.
The economic fallout from the COVID-19 pandemic will leave in its wake a significant increase in commercial chapter 11 filings. Many of these cases will feature extensive litigation involving breach of contract claims, business interruption insurance disputes, and common law causes of action based on novel interpretations of long-standing legal doctrines such as force majeure.
The global COVID-19 pandemic has resulted in widespread closures and suspension of operations, including within the justice system in Ontario. Ontario courts have issued a number of notices detailing the changes to regular court operations. In an effort to simplify the complicated situation already facing insolvency practitioners and their clients, we have summarized the current status of court operations germane to bankruptcy and insolvency matters.
Superior Court of Justice
U.S. Bankruptcy Judge Dennis Montali recently ruled in the Chapter 11 case of Pacific Gas & Electric (“PG&E”) that the Federal Energy Regulatory Commission (“FERC”) has no jurisdiction to interfere with the ability of a bankrupt power utility company to reject power purchase agreements (“PPAs”).
The Supreme Court this week resolved a long-standing open issue regarding the treatment of trademark license rights in bankruptcy proceedings. The Court ruled in favor of Mission Products, a licensee under a trademark license agreement that had been rejected in the chapter 11 case of Tempnology, the debtor-licensor, determining that the rejection constituted a breach of the agreement but did not rescind it.
In January, we wrote about a decision of Justice Watt of the Ontario Court of Appeal, which addressed the question of which appeal procedure must be followed in appeals of Orders made in proceedings constituted under both the Bankruptcy and Insolvency Act (the “BIA”) and the