In a decision that once again evidences the Fifth Circuit’s strong stance on the finality of asset sales in bankruptcy absent a stay of the applicable order, on March 8, 2023 the United States District Court for the Southern District of Texas published a memorandum opinion and order affirming a bankruptcy court’s exercise of Bankruptcy Code provisions to strip subrogation rights of certain sureties (the “Sureties”) against an asset purchaser.
The Supreme Court handed down its judgment on the case of Rakusen v Jepsen on 1 March 2023, deciding that rent repayment orders cannot be made against superior landlords.
The case considered whether rent repayment orders (RROs) under the Housing and Planning Act 2016, could be made against immediate landlords only, or whether superior landlords are also liable.
In a decision that may provide much-needed boundaries around the permissibility of debtors created from “out-of-the-box” prepetition corporate transactions, on January 30, 2023, the United States Court of Appeals for the Third Circuit issued a unanimous opinion dismissing Johnson & Johnson subsidiary LTL Management, LLC’s (“LTL”) chapter 11 case pending in the United States Bankruptcy Court for the District of New Jersey as not being filed in good faith.1
This is the third article in our series about sponsor licences. This article focuses on the effect of insolvency on a sponsor licence.
Businesses are facing challenging times in the current economic downturn and insolvency is a real possibility for many, with 5,595 company insolvencies in the third quarter of 2022[1] alone.
If a business is on the brink of insolvency this will potentially have an impact on any sponsorship licences held within the company group. But what are the implications of this and what does it mean for sponsored employees?
In late December, the U.S. District Court for the District of Delaware issued an opinion in In re: Mallinckrodt PLC affirming the Mallinckrodt bankruptcy court's November 2021 decision that the debtor could discharge certain post-petition, post-confirmation royalty obligations for the sale of the company's Acthar gel.
The district court's affirmation serves as a reminder to holders of intellectual property that a debtor's fresh start under the U.S. Bankruptcy Code could trump royalty obligations that are found to be contingent claims arising as of the time of the transaction.
On 16th December 2022 the Bankruptcy Master released an update which advised that the restriction on filing new creditors' winding up petitions is likely to be lifted in the new term. The court has advised that further information will be issued to legal practitioners in advance of the new guidance.
In a January 5, 2023 opinion from the United States Court of Appeals for the Fifth Circuit, the panel held the Just Energy bankruptcy court erred in exercising jurisdiction over the debtor’s suit to recover Winter Storm Uri payments made to ERCOT. The Fifth Circuit found the underlying issue—i.e., the propriety of ERCOT and PUCT’s pricing—to be precisely the type of controversy that should be decided in the manner carefully prescribed by the Texas legislature, and not be second-guessed by the bankruptcy court.
Cryptocurrency in Celsius’ Earn Accounts belongs to the bankruptcy estate, and not to the depositors who placed it there, according to a January 4 memorandum opinion from Judge Martin Glenn of the U.S. Bankruptcy Court in the Southern District of New York.
In late December 2022, the United States District Court for the District of Delaware issued an opinion affirming the Mallinckrodt bankruptcy court’s November 2021 decision that the debtor could discharge certain post-petition, post-confirmation royalty obligations for the sale of Acthar Gel.
Recent rulings out of the United States Court of Appeals for the Fifth Circuit and its lower bankruptcy courts have emphasized the circuit’s broad interpretation of section 363(m) of the Bankruptcy Code, which protects bankruptcy sales from being overturned on appeal.
In her September 23 opinion in In re Royal Street Bistro, LLC, et al., No. 21-2285, District Judge Sarah S. Vance provided a comprehensive summary of the Fifth Circuit case law while mooting a debtor’s attempt to appeal a sale under section 363 of the Bankruptcy Code.