In Re Southwest Pacific Bauxite (HK) Ltd [2018] 2 HKLRD 449, the Honourable Mr Justice Harris held that a petition to wind up a company on the ground of insolvency should “generally be dismissed” where:

In recent years, the Hong Kong courts have been required to deal with a significant number of cases concerning cross border insolvency. Most notably, a number of cases have arisen where insolvency practitioners appointed by overseas courts seek recognition of their authority to act on behalf of overseas companies placed in liquidation or a similar insolvency regime, and to seek authority to use powers equivalent to those granted to liquidators by the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap.

On May 20, 2019, the Supreme Court settled a circuit split concerning whether a debtor’s rejection of a trademark license under § 365 of the Bankruptcy Code “deprives the licensee of its rights to use the trademark.” In a decision written by Justice Kagan, the Supreme Court held that while a debtor-licensor’s rejection of a trademark license results in a pre-petition breach, it does not constitute a rescission of the contract, and thus the licensee may retain the rights granted to it under the license.

In 2018, approximately 40 companies in the oil and gas industry filed bankruptcy in the United States, including companies engaged in exploration and production, oilfield services, and midstream services.

In Re Kin Ming Toy Manufactory Ltd (in liquidation), HCCW 402/2015 [2018] HKCFI 2057 and 2285, Harris J of the Court of First Instance dismissed an application under section 182 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (the Ordinance), Cap. 32, brought by the liquidators of a company in liquidation seeking to void two payments made out of the company’s bank account after commencement of the winding up proceedings, and further ordered that the liquidators be held personally liable for the costs of the unsuccessful application.

Key Facts

Two years ago, after a slew of bankruptcies in the energy sector triggered by a dramatic drop in commodity prices during the worst downturn for U.S. energy producers since the 1980’s, the Office of the Comptroller of the Currency (OCC) issued new guidance that proposed changes to underwriting analysis and loan risk rating determinations by national banks and federal savings associations of loans secured by oil and gas reserves (RBLs).

1 Driven by a concern that banks were not appropriately capturing risks associated with increased

In the past couple of decades, jurisdictions all over the world have been required to grapple with problems arising out of corporate insolvencies with cross-border elements. Solving these problems has required considerable judicial flexibility and innovation, but judges in some jurisdictions have been helped by the enactment of legislation designed to deal with cross-border status.

The United States Court of Appeals for the Second Circuit affirmed U.S. District Judge Jed S. Rakoff’s decision that the gas gathering contracts that Sabine Oil & Gas Corporation entered into with two midstream service companies were personal obligations, and not “covenants running with the land” under Texas law, which, therefore, could be rejected under Section 365 of the Bankruptcy Code.

Executive Summary

Companies in the health care industry face many unique challenges when undergoing a bankruptcy, including challenges arising due to the federal and state law framework governing the use and disclosure of medical information. In February 2018, the U.S. Department of Health and Human Services announced that it had reached a settlement with the receiver appointed to liquidate the assets of Filefax Inc., a medical record storage and transportation company, resolving claims against Filefax for potential violations of the Health Insurance Portability and Accountability Act, or HIPAA.