Tronox Incorporated and certain affiliates (the “Debtors”) emerged from Chapter 11 in February 2011 armed with a new capital structure and operational game plan, but that’s yesterday’s news. The flavor of the month is last Friday’s decision by Justice Allan L.

The worldwide press has been humming that General Motors has finally taken back the pole position from Toyota as the worldwide sales leader. In contrast, stories about the General Motors bankruptcy have mostly stalled since the automaker’s plan of liquidation took effect last March. Until now.

A recent decision by the Third Circuit in the Nortel Group bankruptcy reinforces the worldwide reach of the automatic stay and the narrow scope of the police power exception under section 362(b)(4) of the Bankruptcy Code.  In Nortel Networks, Inc. v. Trustee of Nortel Networks U.K. Pension Plan, No. 11-1895 (3d Cir. Dec. 29, 2011), the Third Circuit held that the automatic stay barred U.K. pension claimants from participating in U.K. proceedings meant to determine the debtors’ liability for their affiliate’s pension funding shortfalls.

In an Order issued yesterday by the Bankruptcy Court for the Southern District of Texas in the Omega Navigation Enterprises, Inc. (Omega) chapter 11 cases, Judge Karen Brown has denied motions to dismiss or convert Omega’s chapter 11 cases or for relief from stay filed by Omega’s Senior Lenders and supported by Omega’s Junior Lenders and Unsecured Creditors’ Committee. In the view of Lloyd’s List, a leading industry publication:

In an Order issued yesterday by the Bankruptcy Court for the Southern District of Texas in the Omega Navigation Enterprises, Inc. (Omega) chapter 11 cases (the Show Cause Order), Judge Karen Brown has directed Omega’s Senior Lenders, Junior Lenders and Unsecured Creditors’ Committee to show cause whether they should be sanctioned for the conduct described in the Show Cause Order, a copy of which can be found HERE.

After four long years, Australia-based Centro Properties Group (“CNP”) has consummated a global restructuring that combines a debt-for-equity swap with an aggregation of its assets into a new real estate investment trust, Centro Retail Australia (“CRF”). Bracewell & Giuliani was first engaged by Centro’s private placement noteholders in December 2007. As the restructuring progressed Bracewell’s role expanded to becoming lead counsel for CNP’s entire international lending syndicate consisting of more than 90 distressed debt investors, institutional investors and commercial bank

On November 17, 2011 the IRS issued final Treasury Regulations (the “Final Regulations”) that address the tax consequences of a debtor partnership’s issuance of equity in satisfaction of a debt obligation (a “Partnership Equity-for-Debt Exchange”). The Final Regulations provide debtor partnerships, their partners and creditors with welcome clarity regarding the federal income tax consequences of such restructuring. 

Numerous municipalities in California and elsewhere are struggling financially. Indeed, Harrisburg, Pennsylvania and Central Falls, Rhode Island have both recently filed for Chapter 9 protection. State governments may have neither the economic reserves nor the political will to bail out troubled cities and counties. These circumstances have raised the focus on Chapter 9 as a tool for reorganizing municipality debt obligations and has deepened the debate between states and their municipalities about the best strategies for addressing a fiscal crisis.

The enforcement of triangular setoffs in bankruptcy, where affiliates set off their claims against the debtor, received another setback in a recent decision in the Lehman bankruptcy cases. See In re Lehman Brothers Inc., No. 08-01420 (JMP) (SIPA), 2011 WL 4553015 (Bankr. S.D.N.Y. Oct.

Recent remarks by the English High Court in the insolvency case Green (Liquidator of Stealth Construction Limited) -v- Ireland [2011] EWHC 1305 (Ch) suggest that in some circumstances, and at least in the context of fast-moving real property transactions, an exchange of emails may well satisfy the requisite formalities for creation of a binding and enforceable contract.