The impact of Covid-19 is clearly the big talking point for 2022, with several questions arising: will new variants emerge, what steps will governments take to limit the spread, and what impact will it have on industries? To date, enforcement actions, insolvencies and restructurings have been relatively light, but with new restructuring legislation reforms on the horizon, and creditors starting to ramp up speed to enforcement, it appears likely that there will be an increase in winding up and cross-border restructuring work.
A recent decision applied the ordinary course of business defense to a preferential transfer claim where the parties had engaged in only two transactions. In re Reagor Dykes Motors, LP, Case No. 18-50214, Adv. No. 20-05031, 2022 LEXIS 70 (Bankr. N.D. Tex. Jan. 11, 2022). The court took a practical approach to the defense, given the absence of a detailed history of invoicing and payments between the parties.
Another case shows the perils of waiting until the final minutes to meet a court deadline. In re U-Haul, 21-bk-20140, 2021 Bankr LEXIS 3373 (Bankr. S.D. W. Va. Dec. 10, 2021).
The debtor is a well-known truck rental company. Years before the debtor filed for bankruptcy, a class action lawsuit was filed against it. The suit alleged the debtor had improperly charged certain environmental fees and sought damages totaling $53 million.
“Messrs. Woods and Wu are fraudsters,” Judge Christopher S. Sontchi declared in the opening salvo of his scathing opinion. According to the former Chief Judge of the U.S. Bankruptcy Court for the District of Delaware, Woods and Wu fraudulently obtained a Paycheck Protection Program (“PPP”) loan on behalf of Urban Commons Queensway, LLC, which indirectly operates the Queen Mary, a cruise ship turned hotel docked near Long Beach, CA.
A federal judge recently allowed a trustee’s preferential transfer claim against a law firm to proceed but dismissed a constructivefraudulent transfer claim. The decision highlights the pleading standards and analytical framework for motions to dismiss such claims. Insys Liquidation Trust v. Urquhart(In re Insys Therapeutics Inc.), Case No. 19-11292, Adv. No. 21-50359, 21 Bankr.
In many chapter 11 cases, creditors’ committees can play a vital role in maximizing the recoveries of unsecured creditors. But the powers of creditors’ committees are circumscribed by both the Bankruptcy Code and case law.
U.S. Bankruptcy Judge Craig A. Gargotta rejected a debtor’s attempt to use “CARES Act” funds, which it did not actually qualify for, to pay creditors in its chapter 11 case.
Where a shareholder has redeemed his shareholding following a failed investment without objection some months prior to the initiation of a voluntary liquidation, the Court will not permit him to use the statutory deferral provisions relating to voluntary liquidations for an abusive or improper purpose. This includes using such proceedings as leverage to exert undue pressure in proposed claims against the company or directors.
Passing the Golden Thread through the Eye of a Needle In Singularis 1 , as is well known, the Privy Council Board considered the doctrine of modified universalism whereby, broadly speaking, a court will give such assistance as it can to foreign insolvency proceedings, as is consistent with local law and local public policy, so as to ensure that a company's assets are distributed under a single system; and held by a majority that there is a common law power to assist a foreign insolvency, although the power could not be used to enable foreign liquidators to do something that they could not d
In a recent decision, a district court reversed the decision of the bankruptcy court and clarified the independent obligation of the Bankruptcy Court to ensure that a Chapter 13 Plan satisfies the necessary requirements of the Bankruptcy Code, irrespective of the parties’ conduct. In re: BRUCE D. PERRY, Debtor. KRISTA PREUSS, Standing Chapter 13 Tr., SDNY, Appellant, v. BRUCE D. PERRY, Appellee., No. 20-CV-4617 (CS), 2021 WL 4298192 (S.D.N.Y. Sept. 21, 2021)