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Second Circuit holds that a sale by a chapter 15 debtor in a foreign main proceeding of a claim against an obligor located in the U.S. must be reviewed by the U.S. Bankruptcy Court under section 363 of the Bankruptcy Code

On September 26, 2014, the United States Court of Appeals for the Second Circuit, overturning decisions by the Bankruptcy Court and the District Court for the Southern District of New York, held that the Bankruptcy Court was required to review under section 363 of the Bankruptcy Code the transfer of a claim by a chapter 15 debtor with a recognized foreign main proceeding pending in the British Virgin Islands (the “BVI”).1     In a case under chapter 15 of the Bankruptcy Code in which a foreign main proceeding has been recognized, section 1520(a)(2) of the Bankr

USA, Insolvency & Restructuring, Litigation, Fried Frank Harris Shriver & Jacobson LLP, Debtor, Title 11 of the US Code, Second Circuit, United States bankruptcy court
S.D.N.Y. Bankruptcy Court denies claim for make-whole premium and allows cram down of debtors’ chapter 11 plan paying secured creditors below-market interest rates on replacement notes

On August 26, 2014, the Honorable Robert D. Drain, Bankruptcy Judge of the United States Bankruptcy Court for the Southern District of New York, issued several bench rulings (the “Bench Rulings”) in connection with confirmation of a plan of reorganization in the chapter 11 cases of MPM Silicones, LLC, et al.

USA, New York, Insolvency & Restructuring, Litigation, Fried Frank Harris Shriver & Jacobson LLP, Debtor, United States bankruptcy court
US corporation not a joint employer of the French workforce for merely coordinating group interests and exercising financial influence over the French subsidiary

Given the unfortunate reputation of French courts for awarding substantial damages to employees for unfair terminations, US corporations with operations in France are anxious to limit their financial and legal exposure in case of litigation initiated by their French workforce.  How to achieve this efficiently is a far from rhetorical question as French employees frequently pull in the US parent company as a named defendant.  The recent decision of the French Supreme Court [Cass. Soc.

France, USA, Employment & Labor, Insolvency & Restructuring, Litigation, Seyfarth Shaw LLP
Fourth Circuit invalidates third-party release provision in chapter 11 plan

On June 27, 2014, in National Heritage Foundation, Inc. v. Highbourne Foundation, 1 the United States  Court of Appeals for the Fourth Circuit, agreeing with decisions by the Bankruptcy Court for the Eastern  District of Virginia and the District Court for the Eastern District of Virginia, which were issued upon  remand from a prior appeal, held that the third-party non-debtor release provision in the chapter 11 plan  of reorganization of National Heritage Foundation, Inc.  was invalid.

USA, Insolvency & Restructuring, Litigation, Fried Frank Harris Shriver & Jacobson LLP, Debtor, Remand (court procedure), Fourth Circuit, Sixth Circuit
Chapter 11 plan provision allowing individual members of official committee to be reimbursed for professional fees and expenses held invalid, but committee members may be awarded reimbursement for professional fees and expenses incurred in making a

Substantial Contribution to the Case

USA, New York, Insolvency & Restructuring, Litigation, Fried Frank Harris Shriver & Jacobson LLP
Eighth Circuit holds that trademark license included in substantially performed integrated asset purchase transaction is not an executory contract subject to rejection

On June 6, 2014, in Lewis Brothers Bakeries Incorporated and Chicago Baking Company v.

USA, Insolvency & Restructuring, Litigation, Trademarks, Fried Frank Harris Shriver & Jacobson LLP, Eighth Circuit
The Supreme Court clarifies the role of bankruptcy courts in Stern v. Marshall-type proceedings, but leaves consent issue for another day

Background

USA, Insolvency & Restructuring, Litigation, Fried Frank Harris Shriver & Jacobson LLP, Tortious interference, United States bankruptcy court
Bankruptcy: assignment of voting rights

One of the more effective risk-mitigation legal tools used by  senior real estate lenders is the single purpose entity borrower.  Among other things, having a single purpose, bankruptcy  remote borrower makes avoiding the risks of bankruptcy easier.  Even in bankruptcy, if the borrower is truly single purpose, and it  keeps the universe of creditors small, the senior secured lender  will have an easier time defeating any plan of reorganization  proposed by the borrower because it will control all of the  legitimate classes of creditors by virtue of th

USA, Banking, Insolvency & Restructuring, Real Estate, Seyfarth Shaw LLP, Bankruptcy, Debtor, Secured loan
Proposed changes to the UK listing regime

Yesterday the UK Financial Conduct Authority (the “FCA”) published  the final text of some significant changes to the Listing Rules.1 The changes, which will come into force on 16 May 2014, are intended to enhance the effectiveness of the UK listing regime, particularly in situations where the rights of minority shareholders are at risk of being abused, and to address concerns in relation to the potential influence of 

controlling shareholders on UK listed companies, while ensuring that London remains an attractive listing 

venue.

United Kingdom, Capital Markets, Company & Commercial, Insolvency & Restructuring, Telecoms, Fried Frank Harris Shriver & Jacobson LLP, Listing Rules, Financial Conduct Authority (UK)
Debt fund enjoined from voting on chapter 11 plan because it is not a “financial institution” under assignment eligibility clause of loan agreement

Assignees of Loan Only Entitled to One Collective Vote on Plan

USA, Washington, Banking, Insolvency & Restructuring, Litigation, Fried Frank Harris Shriver & Jacobson LLP, Injunction, Debt, Default (finance), Distressed securities, United States bankruptcy court