For those following the fallout from the Fyre Festival, the drama continues. Last week, model and influencer Kendall Jenner settled a bankruptcy lawsuit for $90,000 relating to her promotion of the Festival.

The UK Department for Business, Energy and Industrial Strategy introduced the Corporate Insolvency and Governance Bill (the Bill)¹ into Parliament on 20 May 2020. The Bill is due to proceed through Parliament on an accelerated timetable and is expected to come into force without changes towards the end of June 2020.

Guiding a business as a chief executive officer is difficult in the best of times. In the midst of a pandemic, uncertainty is rampant. However, in that uncertainty often times there is opportunity.

Sometimes Chapter 11 is a viable and appropriate strategy for an organization to right size its balance sheet and adjust its long term contracts. CEO's must adapt to changing circumstances. Careful consideration of the impacts - both positive and negative - of Chapter 11 can be critical to guiding an organization and in some cases, it may allow a business to thrive.

The United States Supreme Court opted not to hear a dispute regarding broad third party releases contained in a plan of reorganization which releases were held by lower courts to be binding on nonconsenting creditors. In the Third Circuit bankruptcy case of Millenium Lab Holdings II LLC, the bankruptcy court approved a plan containing such releases, a decision upheld on appeal by the District Court in Delaware and thereafter by the Third Circuit Court of Appeals. The Third Circuit's decision was largely based on its interpretation of the Supreme Court's decision in Stern v.

While the full extent of COVID-19’s impact on the economy remains to be seen, it will likely create significant restructuring activity for companies already experiencing financial distress and otherwise healthy companies distressed by the pandemic. We have already seen an increase in chapter 11 filings, and more will follow.

The uncertainty surrounding the COVID-19 pandemic has rocked the global economy, and companies of all types and sizes are feeling the impacts. In recent weeks, certain high-profile retailers filed for Chapter 11 bankruptcy protection. Some airlines are expected to enter bankruptcy as well, and even farmers are feeling the pinch. Overall, data suggest that bankruptcies will increase almost 25 percent from last year.

As the economic effects of the coronavirus (COVID-19) pandemic continue to be felt, Germany’s protective shield proceeding under Section 270b of the Insolvency Code is a way for companies to restructure under the direction of management.

The Corporate Insolvency and Governance Bill 2019-21 introduced to the UK parliament on 20 May contains provisions designed to give companies greater administrative flexibility during the COVID-19 pandemic, including how and when they are required to hold their AGMs and other general meetings and when key Companies House filings have to be made, such as annual accounts, confirmation statements and other forms, as well as the registration of charges.

The UK government on 20 May set out its hotly anticipated Corporate Insolvency and Governance Bill, which, once enacted, will bring into force previously announced insolvency reforms.

We summarise below the main provisions of the bill as it currently stands. Please look out for further LawFlashes on this legislation as it develops over the next few weeks.

Moratorium

The Department for Business, Energy and Industrial Strategy published the Corporate Insolvency and Governance Bill yesterday (20 May 2020). The Bill, when enacted, represents the most significant amendment to the UK’s insolvency laws since the Enterprise Act 2002 introduced the administration regime.