Judge Parker of the U.S. Bankruptcy Court for the Western District of Texas recently issued an order in the case of Hilltop SPV, LLC, granting debtor Hilltop SPV LLC’s (“Hilltop”) motion to reject a Gas Gathering Agreement (“GGA”) with counter-party Monarch Midstream, LLC (“Monarch”).[1] This decision allows Hilltop to reject the GGA while allowing Monarch to retain the covenants that run with the land post-rejection.

Harrington v. Purdue Pharma L.P., 144 S. Ct. 2017 (June 27, 2024)

The U.S. Supreme Court held last week in Truck Insurance Exchange v. Kaiser Gypsum Co. that an insurance company with financial responsibility for bankruptcy claims is a “party in interest” with the right to object to a Chapter 11 reorganization plan.

Section 1109(b) of the Bankruptcy Code provides:

2023 has been a remarkable year with the past several months displaying an upward trend for the Business Restructuring + Insolvency Group at Morrison Foerster. We would like to provide our friends and clients with an overview of our current matters, each of which demonstrate our track record of being a go-to firm for complex restructurings across industries and jurisdictions.

Purchasers often relish the prospect of buying distressed assets in a bankruptcy proceeding. Under section 363 of the Bankruptcy Code, a buyer may obtain ownership of bankruptcy estate assets “free and clear of any interest” (assuming certain conditions are met), and also be reasonably confident that the sale will not be reversed on appeal. But the U.S. Supreme Court may have now tempered that confidence. In its recent, unanimous opinion, MOAC Mall Holdings LLC v. Transform Holdco LLC, No. 21-1270 (Apr.

Overview/Executive Summary

In response to the recent collapse of several prominent banking institutions, Morrison Foerster conducted a brief poll to gauge how companies and their employees are faring in the wake of these historic events. Our goal is to understand how this situation has impacted these organizations, including delving into which issues and challenges, if any, will be top of mind for business leaders and their respective organizations in the weeks and months ahead.

Methodology

The FDIC receiverships of Silicon Valley Bank and Signature Bank have caused certain early-stage companies to face potentially crippling near-term liquidity issues. These liquidity issues may result in a company becoming insolvent. Therefore, boards of directors of such companies need to consider their fiduciary duties as well as steps that can be taken to mitigate risks.

Fiduciary duties are typically owed to the company for the benefit of its owners.

The March 2023 banking crisis has been an unexpected “stress test” for dealing with liquidity issues.

When state regulators closed Silicon Valley Bank this past Friday, many startups understandably faced severe liquidity issues triggered by the sudden and unexpected loss of access to their deposits.

The COVID-19 pandemic is a public health crisis unprecedented in modern history, and the resulting economic dislocation has caused financial distress across supply chains worldwide. In light of this extraordinary crisis—and in anticipation of a wave of defaults by businesses large and small in the months to come—shippers, vendors, and other suppliers are assessing their potential exposures in the event of a customer failure.

The American bankruptcy process is geared towards providing (a) financially distressed businesses and individuals with a “fresh start” and (b) their creditors a fair opportunity to address their claims. Much of that process takes place in bankruptcy courts all over the country on a daily basis. So, what effect does a pandemic, such as the novel coronavirus (and its attendant disease, COVID-19), have on the administration of bankruptcy cases in the U.S.? Of course, the federal, state and local restrictions on public gatherings create a challenge for U.S.