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11 U.S.C. § 1191(c)(2) provides (emphasis added):

  • “(c) . . . the condition that a plan be fair and equitable . . . includes . . . (2) . . . all of the projected disposable income of the debtor to be received in the 3-year period, or such longer period not to exceed 5 years as the court may fix, . . . will be applied to make payments under the plan.”

There is little-to-no guidance in the Bankruptcy Code on what “as the court may fix” might mean. So, that meaning is left to the courts to decide.

浅析新形势下上市公司并购重组方向与路径——以上市公司在子公司融资后实施并购重组之案例为视角

引言

2024年3月15日,中国证券监督管理委员会(以下简称“证监会”)发布《关于加强上市公司监管的意见(试行)》,明确“支持上市公司通过并购重组提升投资价值”,鼓励“上市公司综合运用各类工具提升对长期投资的吸引力,积极吸引长期机构投资者”,并提出“多措并举活跃并购重组市场,鼓励上市公司综合运用股份、现金、定向可转债等工具实施并购重组、注入优质资产”

2024年4月12日,国务院发布《关于加强监管防范风险推动资本市场高质量发展的若干意见》,原则性提出“严把发行上市准入关”“严格上市公司持续监管”“大力推动中长期资金入市,持续壮大长期投资力量”等指导意见,进一步提高IPO标准,严格再融资审核把关,鼓励上市公司聚焦主业,综合运用并购重组、股权激励等方式提高发展质量,倡导长期资金入市,鼓励长期资金投资。

Under 11 U.S.C. § 727(a)(2), an individual debtor may be denied a discharge, in its entirely, for making a transfer “with intent to hinder, delay, or defraud” a creditor or the trustee.

On April 17, 2023, the Bankruptcy Court for Eastern Michigan ruled:

A “silent” creditor in Subchapter V is one who does not vote on the debtor’s plan and does not object to that plan. The “silent” creditor is a problem for Subchapter V cases.

The Problem

Here’s the problem:

Here are a couple discharge-related bankruptcy questions I’ve heard of late, along with an answer.

Question 1. Why are individuals, but not corporations, eligible for a Chapter 7 discharge?

  • §727(a)(1) says, “the court shall grant the debtor a discharge, unless—(1) the debtor is not an individual” (emphasis added).

Question 2. Why are individuals, but not corporations, subject to § 523(a) discharge exceptions in Chapter 11?

Can non-compete and confidentiality protections in a rejected franchise agreement be discharged in bankruptcy?

The answer is, “No,” according to In re Empower Central Michigan, Inc.[Fn. 1]

Facts

Debtor is an automotive repair shop.

Debtor operates under a Franchise Agreement with Autolab Franchising, LLC. The Franchise Agreement has a non-compete provision, and there is a separate-but-related confidentiality agreement.

The continuing effort in Congress to extend Subchapter V’s $7.5 million debt limit recently hit a snag. The result: the $7.5 million debt limit for Subchapter V eligibility expired on June 21, 2024, and the Subchapter V debt limit is now reduced to an inflation-adjusted $3,024,725.[i]

The phrase “Texas Two-Step,” as used in bankruptcy, is a legal expletive. Regardless of what the details of a Texas Two-Step might be, the phrase has become synonymous with:

  • abusive behavior;
  • bad faith conduct;
  • a means for swindling creditors;
  • the antithesis of “doing what’s right”;
  • a tool for avoiding liability;
  • etc., etc.

Describing a legal tactic as a “Texas Two-Step” is like calling that tactic a “#$&*#%R&” or “#*$&.” It’s a legal expletive that means “really, really bad.”

Here’s a dilemma:

  • Should bankruptcy be available as a tool for resolving mass tort cases of all types (like it already is in asbestos contexts)?

Here’s an illustration of the dilemma:

  • many tort claimants in the Johnson & Johnson case DO NOT want bankruptcy involved; but
  • many tort claimants in the Purdue Pharma case were BEGGING the courts to approve the bankruptcy plan.

How do we solve this dilemma?

The U.S. Supreme Court’s opinion is Truck Insurance Exchange v. Kaiser Gypsum Co., Inc., Case No. 22-1079, Decided June 6, 2024.

Opinion’s Q & A

The Truck Insurance question is this:

  • Whether an insurer with financial responsibility for a bankruptcy claim is a “party in interest” under § 1109(b)?

The Supreme Court’s answer is this: