In a sudden and stunning collapse, FTX, the world’s second largest cryptocurrency exchange, run by 30-year-old Sam Bankman-Fried along with more than 130 entities affiliated with FTX, filed for Chapter 11 bankruptcy protection in Delaware on Friday.[1] Separately, the Securities Commission of the Bahamas appointed a Bahamas-based provisional liquidator for the controlling FTX entity and froze its assets along with

On Aug. 30, 2021, in a significant decision that paves the way for additional substantial recoveries for the victims of Bernard L. Madoff’s Ponzi scheme, the Second Circuit Court of Appeals preserved the ability of Irving H. Picard, SIPA Trustee for the liquidation of Bernard L. Madoff Investment Securities LLC (BLMIS), to pursue $3.75 billion of stolen customer property currently in the hands of participants in the global financial markets.

. The debtor did not notify a tort claimant of his chapter 11 filing. The claimant filed an action against the debtor after the bankruptcy filing. The debtor did not respond, and the claimant obtained a default judgment. The debtor’s case was dismissed for failure to prosecute. Later, the debtor filed a second chapter 11 case, which was converted to chapter 7. The claimant sought retroactive stay r

The debtor violated numerous state court orders in actions to recover amounts he misappropriated. The state court held him in contempt and imposed monetary sanctions and ordered him to stop managing property he did not own and to turnover proceeds from the illegal management. The debtor filed his bankruptcy petition the day before a state court hearing on sentencing the debtor to jail for contempt.

The city impounded the debtor’s vehicle for nonpayment of traffic fines. The debtor filed a chapter 13 petition and demanded turnover of the car. Section 362(a)(3) stays any act to “exercise control over property of the estate.” Section 542(a) requires one in possession of property of the estate to deliver it to the trustee. The most natural reading of section 362(a)(3) is that it prohibits affirmative acts that alter the status quo and does not impose an affirmative obligation on a party holding property of the estate to turn it over. Section 542(a) performs that function.

On January 12, 2021, the Department of Justice (the “DOJ”) settled its first civil action for alleged fraud against the Paycheck Protection Program (the “PPP”) – the primary lending program under the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act for small businesses negatively impacted by the COVID-19 pandemic.

Over the past four years, midstream firms have struggled to adapt their long-standing practices and adjust their long-held expectations, which were fundamentally disrupted by the outcome of the landmark bankruptcy case, In re Sabine Oil & Gas. Midstream providers have since developed and relied on certain mechanisms and carefully drafted contract language in order to bind upstream companies and their successors in interest to obligations and restrictions contained of midstream agreements.

As part of a complex series of related transactions, the debtor entered into a note purchase agreement with an investment bank. The agreement specifically disclaimed that the bank was acting as the debtor’s agent or owed the debtor any fiduciary duty. The note proceeds were to be used to pay the debtor’s shareholders to purchase their shares. The investment bank paid the proceeds directly to the shareholders. The trustee sought to avoid the payment as a fraudulent transfer.

 The receivership debtors ran a Ponzi scheme. Acting under the state Uniform Fraudulent Transfer Act, the receiver sued the debtors’ bank to avoid bank deposits as transfers made with actual intent to hinder, delay, or defraud creditors. The UFTA defines “transfer” as any mode, direct or in

FERC proceeding to restrict rejection of a power purchase agreement may be subject to the automatic stay. The debtor had entered into several agreements to purchase power it no longer needed because its reorganization contemplated its exit from the business of selling electricity at retail. The contracts constituted a minimal portion of the debtor’s power contracts and were an insignificant portion of the power market.