Belgium has modified its law on business reorganizations that involve distressed companies. The new law of January 31, 2009, on the continuity of companies came into force on April 1, 2009, replacing an unpopular and rigid law on judicial composition proceedings that dated to 1997.

This new law simplifies the rules and procedures for reorganizing distressed companies by providing a variety of new flexible out-of-court and in-court options designed to facilitate business recovery.

A pre-packaged business sale (or “pre-pack”) is an arrangement under which the sale of a company’s business or assets is agreed in principle with a buyer prior to the appointment of an insolvency practitioner (most commonly an administrator), who then executes the sale shortly after his or her appointment.

As widely expected, GM and all of its domestic subsidiaries filed voluntary petitions under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of New York on June 1, 2009. Besides General Motors Corporation, the other three associated debtors are: Chevrolet-Saturn of Harlem, Inc., Saturn, LLC and Saturn Distribution Corporation. Please note that GMAC is not included in these bankruptcy filings.

Italian Decree 134/2008, which suspended competition law for crisis buyouts, thereby allowing the merger of Alitalia and Air One, has been called into question following a claim of unconstitutionality brought by consumer association Federconsumatori, Italian airline Meridiana, its subsidiary Eurofly and the province of Milan. The question of whether the Decree potentially violates Article 3 on equal treatment and Article 41 on freedom of economic activity has now been referred to the Italian Constitutional Court.

In the matter of Bernard L Madoff Investment Securities LLC [2009] EWHC 442 (Ch), Mr Justice Lewison granted an application for the transfer of personal data in the possession of the joint provisional liquidators of a UK subsidiary to the trustee in bankruptcy of its parent company in the US, Bernard L Madoff Investment Securities LLC. The application was granted on the basis that it was necessary for reasons of substantial public interest.

Judge Arthur J. Gonzalez presided over hearings May 20, 2009, in this mega bankruptcy case. There were 21 matters on the agenda, as well as an emergency motion, that were heard or adjourned to a later date, in approximately two and a half hours of hearings (click here for a link to the audio file provided by the Clerk of the U.S. Bankruptcy Court for the Southern District of New York; it may take a moment to load before playing).

Our first update1 discussed various initial proceedings in the Chrysler bankruptcy cases. This update provides certain information on the Order Approving Bidding Procedures for the Sale of Substantially all of the Debtors’ Assets, which was entered by the court on May 7, 2009, and the Interim Order Approving a DIP Credit Facility and Authorizing the Debtors to Obtain Post-Petition Financing, which was entered by the court on May 4, 2009. The final DIP Financing and Sale hearings are scheduled for May 20, 2009, and May 27, 2009, respectively.

As widely reported, on April 30, 2009, (the Petition Date), Chrysler LLC and its 24 domestic and indirect subsidiaries (the Debtors) filed voluntary petitions under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York (the Court).

Companies that terminate pension plans before filing for bankruptcy may no longer escape paying significant claims to the PBGC.

In Pension Benefit Guaranty Corporation v. Oneida, Ltd. dated April 8, 2009, the U.S. Court of Appeals for the Second Circuit reversed a ruling by the U.S. Bankruptcy Court for the Southern District of New York characterizing certain “termination premiums” owed to the Pension Benefit Guaranty Corporation (PBGC) pursuant to the Deficit Reduction Act of 2005 as contingent, pre-petition claims and thus dischargeable in bankruptcy.

In Thabalt v Chait (Nov. 2008), the U.S. Court of Appeals for the Third Circuit upheld an award of damages against PriceWaterhouseCoopers LLP (PWC) based on PWC’s alleged negligent audit of the Ambassador Insurance Company. Plaintiff, the Vermont Insurance