Any legislation or action which seeks to alter the pari passu distribution of an insolvent company's property amongst its creditors needs to be very carefully and comprehensively considered, and have regard to accrued rights and interests.

In a prior post, we set forth the potential liability of employers for collection of debts owed by employees in violation of the bankruptcy stay. To protect themselves from such liability, employers that accrue claims against their employees in the ordinary course of business should implement written protocols designed in consultation with bankruptcy counsel.

The Bankruptcy Court for the District of Delaware recently held that the Bankruptcy Code Section 546(e) safe harbors do not prevent a liquidation trust from pursuing some state law constructive fraudulent conveyance claims assigned to the trust by creditors.1 Notably, the Bankruptcy Court declined to follow the Second Circuit's recent Tribune decision, in which the Second Circuit concluded that the Section 546(e) safe harbors apply to state law constructive fraudulent conveyance claims on federal preemption grounds.2 Instead, the Bankruptcy Court decided that federal preemption did not appl

The decision in In the matter of Independent Contractor Services (Aust) could mean more reliance upon fair entitlements guarantee funding provided by the Commonwealth in relation to the liquidation of trading trusts.

In a highly anticipated decision, the Bankruptcy Court for the Southern District of New York (the "Court") on June 28, 2016, dismissed Counts I through XIX of Lehman Brothers Special Financing Inc.'s ("LBSF") fourth amended complaint (the "Complaint") in Lehman Bros. Special Fin. Inc. v. Bank of America, N.A., et al.1 In doing so, the Court removed the majority of the approximately 250 noteholder, issuer and indenture trustee defendants from the LBSF lawsuit to recover over $1 billion distributed in connection with 44 swap transactions.

Businesses need to have written protocols in place to deal with bankruptcy filings by their employees and independent contractors, or they risk serious sanctions and, potentially, punitive damages for violations of the bankruptcy laws. Consider two examples.

The Board of Governors of the Federal Reserve System (the "Federal Reserve") recently issued a proposed rule (the "Proposed Rule") that would significantly limit derivative counterparty remedies upon the insolvency of US global systematically important banking organizations ("GSIB") and their affiliates and the US operations of foreign GSIBs (collectively, "Covered Entities").

Since April, two bankruptcy courts have refused to enforce limited liability company ("LLC") agreement provisions requiring the respective LLCs to obtain the unanimous consent of their members in order to seek bankruptcy relief.1 On June 3, 2016, the Bankruptcy Court for the District of Delaware (the "Delaware Bankruptcy Court") relied on federal public policy to invalidate an LLC agreement provision requiring unanimous member consent to file bankruptcy where the member at issue owed no fiduciary duties to the LLC and the member's primary relationship to the

Key Points:

This case provides some clarification of matters relating to registration of retention of title clauses for secured creditors dealing with grantors

The registration of security interests on the Personal Property Securities Register (PPSR) is a critical, yet unresolved, issue in the context of the appointment of administrators and liquidators, and also for parties to sale transactions.

Earlier this month, teen clothing retailer Aéropostale filed for Chapter 11 bankruptcy protection, seeking to immediately close 154 of its over 800 stores located throughout the United States and Canada. Many of these stores are located in smaller shopping malls, which have been hit the hardest by the shift to online shopping.

The continued march of retail bankruptcies since 2015 includes Sports Authority, Vestis Retail Group, Inc. (the operator of Sports Chalet, Eastern Mountain Sports, and Bob’s Stores), Radio Shack, American Apparel, Quicksilver, Wet Seal, Delia’s and PacSun.