Rejecting the formalistic approach, the Delaware Bankruptcy Court in Indianapolis Downs, LLC¹ focused on the policies underlying the idea of the disclosure statement to uphold a post-petition lock-up agreement, entered into before approval of a disclosure statement, with sophisticated financial players who had access to the material information that the disclosure statement would have provided.

The highly anticipated decision of the Supreme Court of Canada in Re: Indalex was released this morning.

Here are the key highlights:

In a measured opinion hewing closely to standard principles of contract interpretation, the United States Court of Appeals for the Second Circuit in NML Capital, Ltd. v. Republic of Argentina, No. 12-105, slip op. (2d Cir. Oct. 26, 2012), rejected the notion that a sovereign may issue bonds governed by New York state law and subject to the jurisdiction of the state’s courts, and then restructure those bonds in a manner that violates New York state law.

Becoming the first Court of Appeals to address an issue that has divided the bankruptcy and district courts, the Ninth Circuit adopted a forceful view of Stern v. Marshall,1 to hold in In re Bellingham Insurance Agency, Inc.2 that absent the parties’ consent, the limitations imposed by Article III of the Constitution deprive a bankruptcy judge of the constitutional authority to enter judgment on fraudulent transfer claims brought against parties who have not filed proofs of claim.

On July 6, 2012, in Lightsquared LP (Re),¹ the Ontario Superior Court of Justice (the "Ontario Court"), released reasons that clarify the criteria for the identification of the centre of main interest ("COMI") of an applicant seeking recognition of foreign insolvency proceedings as "Foreign Main Proceedings" pursuant to Section 46 of the Companies' Creditors Arrangement Act ("CCAA").²

Law Decree No. 83/2012, providing “Urgent Measures for the Country's Development”

Law Decree No. 83 of 22 June 2012 (the “Decree”), effective as from 26 June 2012 and converted into law with amendments1, has introduced important measures aimed at stimulating the Italian economy (also referred to as “Decreto Sviluppo”).

The Decree, consisting of seventy articles, sets forth a heterogeneous set of rules, including, among other provisions, significant amendments to the Italian Bankruptcy Law.2

In a surprising decision certain to reinvigorate the ongoing debate about the scope of Stern v. Marshall, ___ U.S. ___, 131 S. Ct. 2594 (2011), the Sixth Circuit Court of Appeals adopted a broad view of Stern and held that the structural nature of the limitations imposed on bankruptcy courts by Article III of the Constitution could not be waived by a party’s failure to object at the trial court level. The decision, Waldman v. Stone, 2012 WL 5275241 (6th Cir. Oct.

introduction

The British Columbia Supreme Court recently reviewed the considerations to be applied on an application by a secured creditor to lift a stay of proceedings granted in an initial order under the Companies' Creditors Arrangement Act (the "CCAA"). In Re Azure Dynamics Corp.,¹ Madam Justice Fitzpatrick confirmed that the classic "doomed to fail" argument will not be persuasive where the applicant creditor is not prejudiced, and where the objectives of the CCAA are best served, by allowing the stay of proceedings to continue.

background

On May 14, 2012, in 9-Ball Interests Inc. v. Traditional Life Sciences Inc.¹, the Ontario Superior Court of Justice (the "Court") rendered another decision that demonstrates the importance of full disclosure and transparency in applications made to the Court.