In First Southern National Bank v. Sunnyslope Housing Limited Partnership, No. 12-17241 (9th Cir. May 26, 2017), the Ninth Circuit Court of Appeals, in an en banc decision, held that, for purposes of confirmation of a plan of reorganization over a mortgagee’s objection, the value of the mortgagee’s secured claim was the value of the property as low income housing not the value the mortgagee would have received on foreclosure free of the low income housing restrictions.

The number of consumer claims filed since the Great Recession has skyrocketed. These claims include alleged violations of an “alphabet soup” of federal and state consumer protection statutes. These statutes allow prevailing plaintiffs to recover some combination of actual damages, statutory damages, and even attorney’s fees. They also present a minimal risk of liability for defense costs if the plaintiff does not prevail, which makes these types of claims enticing for plaintiffs’ attorneys.

In Pacifica L 51 LLC v. New Investments, Inc. (In re New Investments, Inc.), 840 F.3d 1137 (9th Cir. 2016), the Ninth Circuit Court of Appeals held that Section 1123(d) of the Bankruptcy Code provides that a cure amount may include a post-default rate of interest if the underlying loan documents and applicable non-bankruptcy law provide for the payment of post-default rate interest upon a default.

Addressing a circuit split over a trademark licensee’s rights following a debtor/licensor’s bankruptcy, the US Bankruptcy Appellate Panel (BAP) for the First Circuit held that, although trademarks and trade names are not included in bankruptcy law’s definition of “intellectual property,” the licensee’s rights to use the licensor’s trademarks as set forth in the agreement were not terminated by the debtor’s rejection of the agreement. Mission Prod. Holdings, Inc. v. Tempnology LLC, Case No. 15-065 (BAP, 1st Cir., 2016) (Hoffman, J).

“Top hat plans” have many attractive features, but a new court decision is a reminder that top hat plan participants have limited protections under ERISA – and that assets held in a rabbi trust are not protected from the claims of creditors upon the employer’s bankruptcy or insolvency.

December 2 marks the 15th anniversary of the Enron bankruptcy—a near cataclysmic event that ultimately led to a series of significant legislative, regulatory and public policy developments that inform governance practices to this day. The entire board would be well served by a brief overview of the governance impact of Enron, particularly since many directors were not in board service 15 years ago.

On July 14, 2016, the US Department of Justice (DOJ) announced that the restructuring of a planned $1.5 billion transaction between Tullett Prebon Group Ltd. (Tullett Prebon) and ICAP plc adequately addresses the DOJ’s concerns that the transaction would violate Section 8 of the Clayton Act by creating an interlocking directorate. The parties restructured their transaction after the DOJ issued a Second Request to adequately investigate the parties post-closing ownership structure.

Summary

Effective January 1, 2016, the Pension Benefit Guaranty Corporation (PBGC) altered the reportable event rules for defined benefit pension plans. Under new final regulations, the PBGC substantially reduced the reporting requirements for pension plan administrators, sponsors and contributing employers. In fact, the PBGC estimates that the final regulations will allow 82 percent of pension plans with more than 100 participants to utilize a reporting waiver. 

Is electricity goods or services?  That seemingly simple yet confounding question is illustrated by three recent bankruptcy cases (all of which consider whether an electricity provider is entitled to an administrative expense priority under Bankruptcy Code Section 503(b)(9) for “the value of goods received by the debtor” in the ordinary course within 20 days prior to the automatic stay):