As discussed in our prior blog entitled “New York’s Sovereign Debt Restructuring Proposals,”[1] three bills were introduced in the New York state legislature to overhaul the way sovereign debt restructurings are handled in New York. Those bills sought to implement a comprehensive mechanism for restructuring sovereign debt, limit recovery on certain sovereign debt claims, and amend the champerty defense.
The first half of 2023 witnessed the failure of three financial institutions in quick succession—Silicon Valley Bank (March 10, 2023), Signature Bank (March 12, 2023), and First Republic Bank (May 1, 2023). This was the first time three financial institutions failed in such a compressed time period since the Great Recession of 2008.
The saga of the first Ultra Petroleum Corp. chapter 11 cases appears to have finally come to an end. Numerous articles have been written on the tortured history of whether certain creditors of Ultra Petroleum are entitled to payment of their contractually mandated Make-Whole Amount and default rate of interest.
In the past several years, the United States has seen a tidal wave of retail sector chapter 11 cases. The end result for most of those cases has been going out of business and liquidation sales. On March 11, 2020, Modell’s Sporting Goods commenced its chapter 11 cases seeking to follow a similar path taken by other retailers by closing all 153 sporting goods stores in a controlled liquidation. Unfortunately for Modell’s, the COVID-19 crisis hit the United States just as Modell’s commenced its liquidation.
In Travelers Cas. & Sur. Co. of Am. v. PG&E, 549 U.S. 443 (2007), the Supreme Court held that bankruptcy law does not disallow a post-petition unsecured claim for attorney’s fees to the extent such claim is authorized by a pre-petition contract and not otherwise expressly disallowed. That pronouncement should have stopped all future litigation over the issue. That has not been the case.
A summary of recent developments in insurance, reinsurance and litigation law.
Engelhart CTP v Lloyd's Syndicate 1221: Court holds that all risks cargo policy did not cover fraudulent documents for a non-existent cargo
Armes v Nottinghamshire County Council: Supreme Court again considers the nature of the relationship required to find a defendant vicariously liable
On appeal from a decision in the In re Energy Future Holdings Corp. bankruptcy case, the US Court of Appeals for the Third Circuit recently held that contractual make-whole premium provisions are enforceable where the obligation to repay bond debt is accelerated by a bankruptcy filing.
A summary of recent developments in insurance, reinsurance and litigation law.
This Week's Caselaw
Essar v Norscot: Court confirms that arbitrators can award the costs of litigation funding/time limits for challenging a corrected award
The 2010 Act has now been updated by regulations (the Third Parties (Rights against Insurers) Regulations 2016) to reflect changes in insolvency law. Accordingly, the long-awaited 2010 Act will finally come into force on 1 August 2016.
It will be recalled that the 2010 Act is intended to make it easier for third party claimants to bring direct actions against (re)insurers where an insured has become insolvent. The key changes coming in are as follows: