English law restructuring and insolvency tools are used to implement financial restructurings and the external administration of foreign companies. The attractiveness of the English tools and legal system is highlighted by the prevalence of companies incorporated abroad, especially companies incorporated in the EU, which avail themselves of those tools. English law in this area is impacted by much European law.
English Law Challenges to EU Bank Restructurings Firmly Closed off by U.K. Supreme Court
Summary – Decision of U.K. Supreme Court
On June 27, 2018, Judge Kevin Carey of the United States Bankruptcy Court for the District of Delaware ruled that a dismissal order in a bankruptcy case could provide for exculpation of the estate fiduciaries and their respective professionals. The ruling is a welcome result for all estate fiduciaries whose tireless efforts during a complex bankruptcy case fail to culminate in an approved plan of reorganization. Morrison & Foerster LLP represents the debtors in the matter.
Background
The Supreme Court’s recent decision in Merit Management Group, LP v.
Distressed and special situations investors should take note of the U.S. Bankruptcy Court’s recent decision in Oi’s Chapter 15 case. We present our takeaways for investors.
Court of Appeal judgment: Burlington Loan Management and others v Lomas and others (as the joint administrators of Lehman Brothers International (Europe) (in administration)) [2017] EWCA Civ 1462
Summary and background
On June 27, 2017, the United States Supreme Court granted the petition for writ of certiorari regarding the decision In re Province Grande Olde Liberty, LLC, 655 Fed.Appx. 971 (4th Cir. Aug. 12, 2016) to decide a circuit split on the applicable standard for debt recharacterization.
On January 24, 2017, victims of Bernard Madoff’s Ponzi scheme lost their appeal of a bankruptcy court decision barring them from suing an alleged Madoff co-conspirator because of a third-party injunction contained in a settlement between the alleged co-conspirator and the Trustee liquidating Madoff’s scheme. See A & G Goldman Partnership v. Capital Growth Company (In re Bernard L. Madoff Investment Securities LLC), 565 B.R. 510, 514-515 (S.D.N.Y. Jan.
On May 8, 2017, the U.S. Bankruptcy Court for the Middle District of Florida entered an order compelling production of attorney-client communications between Regions Bank and its counsel, finding that Regions had put those communications “at issue” by raising a good faith affirmative defense under 11 U.S.C. § 548(c) in response to a fraudulent transfer claim brought against it. Welch v. Regions Bank (In re Mongelluzzi), No. 8:14-ap-00653-CED (Bankr. M.D. Fla. May 8, 2017), ECF No. 319 (Delano, J.) (herein Mongelluzzi).
In First Southern National Bank v. Sunnyslope Housing Limited Partnership, No. 12-17241 (9th Cir. May 26, 2017), the Ninth Circuit Court of Appeals, in an en banc decision, held that, for purposes of confirmation of a plan of reorganization over a mortgagee’s objection, the value of the mortgagee’s secured claim was the value of the property as low income housing not the value the mortgagee would have received on foreclosure free of the low income housing restrictions.