Back in December of 2017, the Bankruptcy Protector provided a succinct summary of all cases decided post-Jevic through November 17, 2017. In this update, we discuss the cases decided between November 17, 2017 and May 10, 2019.

The chart below includes the case name, date, and citation; a brief description of the nature of the case; and a brief description of how the Court applied the Jevic.

If a company becomes insolvent or experiences a liquidity crunch, which necessitates a restructuring or resort to higher-risk financing arrangements, the directors should consider whether to commence formal proceedings to facilitate the restructuring or financing.

At the very end of a recent opinion, the First Circuit seemingly provided guidance on how bondholders can attack the constitutionality of Puerto Rico’s debt restricting act, PROMESA (The Puerto Rico Oversight, Management, and Economic Stability Act). However, the apparent guidance offered by the First Circuit may only be fool’s gold.

The United States Court of Appeals for the Third Circuit issued an opinion in Delaware Trust Company v. Morgan Stanley Capital Group, Inc., Wilmington Trust, N.A. (In re Energy Future Holdings Corp.) on June 19, 2019, in which it addressed distributions of assets pursuant to the waterfall provision of an intercreditor agreement in a chapter 11 reorganization.

Not for a long time has the importance of understanding and managing a director’s duties in times of financial distress been so overwhelming. Here, Carey Olsen partner David Jones and associate Tim Molton examine those duties in greater detail, particularly in relation to Guernsey’s company law.

A dispute over whether the Federal Energy Regulatory Commission (“FERC”) can order one of Northern California’s largest natural gas and electric companies – Pacific Gas & Electric Company (“PG&E”) – to reject wholesale power purchase contracts (“PPCs”) will be decided by the United States Bankruptcy Court for the Northern District of California (“Bankruptcy Court”), instead of the United States District Court for the Northern District of California (“District Court”).

Law360

Reprinted with permission from Law360

In a Feb. 20, 2019, opinion in In re Titus,[1] the U.S. Court of Appeals for the Third Circuit, in an opinion authored by Judge Thomas Ambro, announced a new test for calculating damages in fraudulent transfer actions involving tenancy by the entireties transfers.

Facts

Service area / Restructuring and Insolvency

Location / British Virgin Islands

Date / February 2019

This article considers how to challenge an act, omission or decision of an office-holder.

The right to bring a challenge derives from Section 273 of the BVI Insolvency Act 2003, which provides:

A person aggrieved by an act, omission or decision of an office holder may apply to the Court and the Court may confirm, reverse or modify the act, omission or decision of the office holder.

Pacific Gas and Electric Company and PG&E Corporation (together “PG&E”) filed for relief under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Northern District of California on January 29, 2019.

Zone of insolvency - directors in the firing line

Happy New Year?

2018 saw a number of high profile insolvencies around the world, including in Guernsey. The climate for many sectors remains extremely challenging with the UK further hindered by continuing uncertainty around Brexit. EY's Profit Warning Stress Index hit its joint highest level for two years in the third quarter of 2018 with 68 UK quoted companies issuing profit warnings.