Two recent decisions involving health care companies demonstrate how reorganization under Chapter 11 of the Bankruptcy Code¹ can be used to manage large liabilities.

Actions taken to seize control of a securitisation structure and the underlying loan portfolio declared void and of no effect.

Two recent High Court cases, Business Mortgage Finance 6 Plc v Greencoat Investments Limited and others [2019] EWHC 2128 (Ch) (the Greencoat Case) and Business Mortgage Finance 6 Plc v Roundstone Technologies Ltd [2019] EWHC 2917 (Ch) (the Roundstone Case) (together, the Business Mortgage Cases), have affirmed a number of principles relating to securities held through the clearing systems and the powersof receivers, including the following:

On December 30, 2019, the Supreme Court of Newfoundland and Labrador (the “NLSC”) released its decision in Re Norcon Marine Services Ltd.¹ (“Norcon Marine”), dismissing both an application by a debtor for continuance of its Bankruptcy and Insolvency Act² (“BIA”) proposal proceedings under the Companies’ Creditors Arrangement Act³ (“CCAA”) and a competing application by a secured creditor for the appointment of a receiver.

Hogan Lovells Publications | 17 February 2020

"The Net Short": U.S. and European High-Yield Covenant Trends in Response to Net Short Activism

On October 10, 2019, the Supreme Court of British Columbia (the “BCSC” or the “Court”) released its decision in 8640025 Canada Inc. (Re)¹ (“8640025 Canada”), denying an application to replace the monitor (the “Monitor”) in a Companies’ Creditors Arrangement Act² (the "CCAA") proceeding because the applicant was not a creditor and therefore had no standing to bring such an application.

On January 29, 2020, the Alberta Court of Appeal (the “Alberta CA”) released its decision in PricewaterhouseCoopers Inc. v Perpetual Energy Inc.¹ (“Perpetual Energy”), granting applications requiring a trustee in bankruptcy (the “Trustee”) to post security for costs on appeals brought by the Trustee.

The Quebec Court of Appeal’s unanimous decision in Gestion Éric Savard¹ reaffirms the super-priority ranking of CCAA² DIP financing³ over regular unpaid post-filing obligations, absent steps being taken to reverse this usual order of priorities.

In 7636156 Canada Inc. v. OMERS Realty Corporation¹ (“7636156 v. OMERS”), the Ontario Superior Court of Justice (Commercial List) (the “Court”) held that a bankrupt’s landlord was only entitled to have drawn down on a letter of credit by an amount equal to the landlord’s priority claim for three months’ accelerated rent, rather than by the full amount of the letter of credit, and ordered that the landlord pay over the excess to the bankrupt’s trustee.

The Hogan Lovells’ Corporate Insurance Newsletter for January 2020 has been published. This provides a round-up of UK, EU and international regulatory developments relevant to UK based insurance market participants. In this issue, amongst other items, we cover:

Tightening trade restrictions and concerns swirling around intellectual property rights are creating new risks for conglomerates faced with financial stress, especially when it comes to selling their assets.

When conglomerates encounter financial difficulties, they often sell assets to raise cash and pay off debts. But governments in the United States and elsewhere have begun to increase scrutiny of sales of assets to foreign entities buyers. Many governments have the power to restrict certain sales of assets on the basis of national interest concerns.