The New Year seems to be starting with a bang for the ILS industry.  On January 23rd, KKR announced it had taken a 24.9% stake in Nephila.  Earlier in the month Validus reported a $400 million capital raise to fund investments in collateralized reinsurance and ILS.  In a transaction on which Edwards Wildman Palmer LLP advised Transatlantic Re, Transatlantic Re in December acquired a minority interest in Pillar Capital Management and announced a strategic partnership with Pillar, a manager of funds investing in collateralized reinsurance and ILS.

In Ollerenshaw and Reeh v the Financial Services Authority (the FSA), former directors of the Black and White Group Limited (in liquidation) (B&W), challenged decisions of the FSA in a reference to the Upper Tribunal.

In November 2008, Circuit City filed for bankruptcy protection. Circuit City had the same business model as Best Buy: selling electronic equipment in large retail stores. Other retailers with that business model are finding it increasingly difficult to compete with online sales from companies such as Amazon, eBay, or Walmart. Best Buy’s store sales have fallen for the last eight quarters while expenses increase. Although Best Buy has a large cash buffer, many analysts believe it is only a matter of time before Best Buy also files for bankruptcy, perhaps in 2013.

A federal court jury in Manhattan returned verdicts on Monday, November 12, largely exonerating the two most senior Reserve Management Company executives in a Securities and Exchange Commission enforcement action accusing them of fraud.

On October 16, 2012, the United States Tenth Circuit Court of Appeals overturned decisions of the United States Bankruptcy Court for the District of Colorado and the United States District Court for the District of Colorado that had cast doubt as to whether a lender could enforce a security interest in the proceeds from the sale of a borrower’s FCC broadcast license. The case, Valley Bank and Trust Company v. Spectrum Scan, LLC (In re Tracy Broadcasting Corp.), 2012 U.S. App. LEXIS 21505 (10th Cir. Colo. Oct.

The administrator for the longstanding schemes of arrangement for the insolvent London Market "KWELM companies" (Kingscroft Insurance Company Limited, Walbrook Insurance Company Limited, El Paso Insurance Company Limited, Lime Street Insurance Company Limited, and Mutual Reinsurance Company Limited), is finally preparing to wrap up. Walbrook and El Paso previously paid all outstanding claims. On September 30, 2012, the remaining three KWELM companies declared their ultimate dividend percentages and sent final "top-up" payments for agreed claims to scheme creditors.

On September 6, 2012, the National Credit Union Administration Board (NCUA) sued UBS in the United States District Court for the District of Kansas.  The NCUA filed the suit in its capacity as Liquidating Agent of U.S.

In Notice 2012-39 (the “Notice”), the IRS issued guidance announcing its intention to issue regulations with respect to certain transfers of intangible property by a U.S. corporation to a foreign corporation in a reorganization described in section 361 of the Internal Revenue Code (the “Code”), citing significant policy concerns involving certain intellectual property transfers that permit U.S. persons to repatriate earnings without U.S. income taxation. The IRS’ position in the Notice will impact repatriation planning strategies.

Background

The U.S. Fifth Circuit Court of Appeals recently ruled on whether section 546(e) of the Bankruptcy Code exempts payments for electricity provided under a requirements contract from avoidance as preferences. At least where the facts match those of the subject case, MBS Mgmt. Serv., Inc. v. MXEnergy Elect., Inc., No. 11-30553, 2012 WL 3125167 (5th Cir. Aug. 2, 2012), such payments are exempt.

On August 10, the FDIC in its capacity as receiver for Colonial Bank filed five lawsuits – three in Alabama state court, one in New York federal court, and one in California federal court – seeking $741 million in damages from a number of investment banks, including Bank of America Corp., JPMorgan Chase & Co., Citigroup, Inc., and others, for making allegedly false and misleading statements that induced Colonial Bank into buying mortgage-backed securities.