Over the last two years, much of the healthcare world has been watching the government’s prosecution of Insys Therapeutics for its sales and marketing practices related to its Subsys spray. Subsys is powerful and highly addictive fentanyl spray (administered under the tongue) that was approved by the FDA in 2012 for the treatment of persistent breakthrough pain in adult cancer patients who were already receiving, and tolerant to, regular opioid therapy.
In its much anticipated decision, the High Court has unanimously dismissed the Amerind appeal.[1] This decision finally resolves recent uncertainty as to the proper application of trust assets in the liquidation of an insolvent corporate trustee.
In short, the High Court’s decision confirms that in the winding up of a corporate trustee:
On May 20, 2019, the United States Supreme Court ruled that a debtor-licensor’s ‘rejection’ of a trademark license agreement under section 365 of the Bankruptcy Code does not terminate the licensee’s rights to continue to use the trademark. The decision, issued in Mission Product Holdings, Inc. v. Tempnology, LLC, resolved a split among the Circuits, but may spawn additional issues regarding non-debtor contractual rights in bankruptcy.
The Court Tells Debtors, “No Take Backs”
The significance of this decision
On 3 May 2019, the Federal Court of Australia dismissed an application brought by the administrators of an oil and gas exploration company, Paltar Petroleum Limited (Paltar) to adjourn proceedings for the winding-up of the company in insolvency. The decision illustrates that the belated appointment of administrators appointed by directors in response to pending winding-up proceedings is unlikely to keep at bay the approaching fire of liquidation; indeed, it may accelerate it.
Background
The NSW Supreme Court has reaffirmed the criteria for a Court to inquire into a liquidator’s conduct. It is necessary to show that there is at least a ‘well-based suspicion’ indicating a need for further investigation. ‘Mere wondering’ is not enough.
In exercising its discretion, a Court will also consider the nature and gravity of the allegations against the liquidator, delays in seeking an inquiry, the utility of an inquiry and the existence of alternative remedies.
Background
The recent sale of Black Oak Minerals Limited (Black Oak) to Ramelius Resources Limited (ASX: RMS) (Ramelius) shows that section 444GA of theCorporations Act 2001 (Cth) (the Act) can be used to resurrect a company in liquidation.
The Commissioner of Taxation (Commissioner) recently issued draft taxation determination TD 2019/D2 (TD 2019/D2) dealing with the important question of a receiver’s obligation to retain money for post-appointment tax liabilities. A link to TD2019/D2.
Tolstoy warned that “if you look for perfection, you’ll never be content”; but Tolstoy wasn’t a bankruptcy lawyer. In the world of secured lending, perfection is paramount. A secured lender that has not properly perfected its lien can lose its collateral and end up with unsecured status if its borrower files bankruptcy.
The Personal Property Securities Register (PPSR) commenced operation on 30 January 2012. All seven-year registrations made on the:
- old state-based motor vehicle registers, immediately before the PPSR commenced; or
- PPSR immediately after it commenced,
will begin to expire shortly and this will have adverse consequences for secured parties who do not act to renew.
In its ruling in FTI Consulting, Inc. v. Sweeney (In re Centaur, LLC), the United States Bankruptcy Court for the District of Delaware addressed the Supreme Court’s recent clarification of the scope of Bankruptcy Code Section 546(e)’s “safe harbor” provision, affirming a more narrow interpretation of Section 546(e).