A consortium uniting Apple, Inc. and Microsoft with other top players in the software, electronics and wireless handset industries outplayed Google in a bankruptcy court auction for Nortel’s patent portfolio, posting a winning offer of $4.5 billion for the trove of 6,000 patents that cover fourth-generation wireless, data networking, Internet, and semiconductor technologies.

Introduction

On June 23, 2011, after fifteen years of hugely acrimonious litigation, the Supreme Court of the United States (the “Court”) issued a decision on a narrow legal issue that may end up significantly limiting the scope of bankruptcy courts’ core jurisdiction.  

Trial on preliminary issues

Section 108 of the Bankruptcy Code grants a two-year extension of time for a trustee in bankruptcy (or a debtor in possession) to bring law suits, provided that the applicable period to sue didn’t expire before the petition date. It also gives a short extension to the trustee for filing pleadings, curing defaults, and performing other acts on behalf of the debtor. These provisions afford a trustee and debtor in possession valuable time to discover and evaluate potential causes of action and to perform other acts to preserve the debtor’s rights.

Google stepped closer to acquiring Nortel’s portfolio of 6,000 telecommunications, wireless and Internet patents on Monday as courts in the U.S. and Canada approved the web search giant’s “stalking horse” offer of $900 million for those patents. Announced on April 4, Google’s offer effectively constitutes the opening bid in an auction that will be decided at a joint hearing of the U.S. and Canadian courts on June 30. The auction also opens the latest chapter in the ongoing bankruptcy process for Nortel.

On Friday 1 April, the Court of Appeal handed down its much awaited written judgment in Westford Special Situations Fund Limited v Barfield Nominees et al. The decision has far reaching consequences, not only for BVI funds, but also for all types of BVI corporate vehicles. The case directly and indirectly dealt with four major issues:-  

In Yeung Kwok Mung v The Attorney General and the Financial Services Commission, BVIHCM 2011/0002 and Dedyson Enterprises Limited v Registrar of Corporate Affairs, BVIHCM 2011/0008, the BVI High Court Commercial Division addressed the principles applying to restoration applications under section 43 of the BVI Business Companies Act (the “BC Act”). The key principles emerge from the decisions:

The recent decision in Pacific China Holdings Limited v Grand Pacific Holdings Limited, BVIHCV 2009/389 sets out the view of the BVI Commercial Court as to who, if anyone, should be responsible for the remuneration of liquidators where a liquidation order is set aside on appeal.

• In Irving H. Picard v Bernard L. Madoff Investment Securities LLC, BVIHCV 0140/2010, the trustee appointed in the liquidation of the business of Bernard L. Madoff Investment Securities LLC (“Picard” and “BLMIS”) sought, amongst other things, (i) recognition in the BVI as a foreign representative; (ii) an entitlement to apply to the BVI Court for orders in aid of the foreign proceeding; and (iii) an entitlement to require any person to deliver up to him any property of BLMIS.
• Bannister J.

There was good news on two fronts this week for direct broadcast satellite (DBS) operator DISH Network. On Sunday, DISH settled a retransmission dispute with LIN Media with the signing of a new carriage contract that restored to DISH subscribers LIN broadcast network signals that were cut off on March 5. That development was followed by a New York bankruptcy court’s decision on Tuesday to approve a revised agreement through which DISH would acquire the assets of bankrupt mobile satellite services (MSS) provider DBSD North America for $1.5 billion.