PwC, the administrators in the Lehman Brothers administration in the UK, have made several applications to the Court seeking directions on their approach to the distribution of clients’ money and assets. On 29 February 2012 the Supreme Court gave judgment on issues that are central to the interpretation and application of the rules for the protection of client money made by the Financial Services Authority. The issues raised are ones that have divided judicial opinion.

German Insolvency Law – a Leap Forward

Creditors have often complained that German insolvency law does not give them sufficient influence in insolvency proceedings. On 1 March 2012 new amendments to the German bankruptcy code came into force which go some way towards ameliorating this concern and make a host of changes which should improve German insolvency law to facilitate an insolvency culture which facilitates reorganisation rather than liquidation of assets.  

Clarification on the jurisdiction of the English courts to sanction schemes of arrangement for overseas companies

Providing further evidence that schemes of arrangement (“schemes”) are an increasingly useful tool in the restructuring of overseas companies, on 20 January 2012, the High Court sanctioned a scheme proposed by PrimaCom Holding GmbH (“PrimaCom”), a German incorporated company, with its centre of main interests (or “COMI”) in Germany and whose affected creditors were domiciled outside the UK.

Many experienced business people are now familiar with the process by which their valid and successful debt collection efforts result in liability under the preference provisions of the Bankruptcy Code.

New amendments to Federal Rule of Bankruptcy Procedure 2019 were recently adopted in an attempt to clarify requirements surrounding file 2019 statements in Chapter 11 bankruptcy cases.

Prior to the amendments, which were adopted Dec. 1, 2011, Rule 2019 was often applied in an inconsistent haphazard manner resulting in a great deal of uncertainty regarding who was required to file the statement and under what circumstances that statement was required to be filed.  

The Original Rule 2019

If you are a creditor of a Delaware limited liability company and wish to pursue derivative claims on behalf of an insolvent company against the company’s present or former managers based on breaches of fiduciary duties, you may be out of luck. The Delaware Supreme Court recently decided in CML V LLC v. Bax, 2011 Del. LEXIS 480 (Sept. 2, 2011), that creditors’ rights against limited liability companies differ from those against corporations.

On September 13, 2011, the Federal Deposit Insurance Corporation (the “FDIC”) approved a final rule (the “Final Rules”) to be issued jointly by the FDIC and the Board of Governors of the Federal Reserve System (the “Board”) intended to implement section 165(d) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) which requires each non-bank financial company supervised by the Board and each bank holding company with assets of US$50 billion or more (each, a “Covered Company”)1 to report periodically to the Board, the FDIC and the Financial Stability Oversig

We write to provide an important update concerning Executive Life Insurance Company of New York (“ELNY”).

Recently secured parties, including some indenture trustees, have found the priority, scope, validity and enforceability of seemingly properly perfected security interests in Federal Communications Commission (“FCC”) licenses, authorizations and permits, and any proceeds or value derived therefrom, challenged by creditors in bankruptcy proceedings.

Imagine a scenario in which you have a long standing relationship with an important customer and you learn that this customer is running into financial difficulties. In the current economic cycle, this is probably not a hypothetical, but, rather, an everyday reality. During the course of the relationship, this important customer has from time to time fallen behind in paying invoices and has even reached or exceeded the credit limits your company has imposed on this customer.