The Czech Supreme Court recently issued two decisions having significant impact on the position of secured creditors (i.e. generally financial institutions) within insolvency proceedings. Both decisions stem from one of the first major insolvencies conducted under the (then new) Czech Insolvency Act effective from 2008 in respect of the group of companies in a glass-making business. This article briefly reviews those decisions and points out their practical effects on the rights of secured creditors.
Security interest in rental income
In an interesting decision with important implications for both Chapter 15 practice and financial institutions’ global credit risk analyses, a US Chapter 15 court (the “Court”) granted recognition of a number of Brazilian proceedings involving entities within the OAS Group. See In re OAS S.A. et al., Case No. 15-10937 (SMB) (Bankr.
Law360, New York (July 17, 2015, 11:24 AM ET) -- On June 26, 2015, the U.S. District Court for the Middle District of Florida issued an opinion on consolidated appeals arising from the Bayou Shores SNF LLC bankruptcy case with potentially broad implications for health care bankruptcy cases. At the heart of the dispute before the district court was whether the bankruptcy court had jurisdiction to enjoin the termination of, and subsequently authorize the assumption of, certain Medicare and Medicaid provider agreements.
On June 26, 2015, the District Court for the Middle District of Florida issued an opinion on consolidated appeals arising from the Bayou Shores SNF, LLC bankruptcy case with potentially broad implications for healthcare bankruptcy cases. At the heart of the dispute before the District Court was whether the Bankruptcy Court had jurisdiction to enjoin the termination of, and subsequently authorize the assumption of, certain Medicare and Medicaid provider agreements in the bankruptcy case. As discussed below, the District Court held the Medicare jurisdictional bar set fort
On April 8, 2015, we distributed a Corporate Alert outlining two important decisions of the US District Court for the Southern District of New York and their potential effects on future debt exchange offers.1 Since then, the Education Management court has issued a final ruling on the following question, as stated by the court in its most recent decision: “does a debt restructuring violate Section 316(b) of the Trust Indenture Act (the Act) when it does not modify any indenture term explicitly governing the right to receive interest or principal on
On 20 May 2015 the recast EC Regulation on Insolvency Proceedings (2015/848) (Recast Regulation) was adopted and will apply to insolvency proceedings opened after 26 June 2017 in Member States (other than Denmark). Broader in scope than the original Regulation (1346/2000) (Regulation) it replaces, the Recast Regulation introduces new rules on centre of main interests (COMI) and secondary proceedings as well as a framework for coordinating group insolvency proceedings and better communication. Helen Anderson considers the changes of most interest to banks and other lenders.
Germany’s Frankfurt District Court recently dealt with the question of whether a debtor’s lawyers’ fees arising from restructuring advice prior to insolvency could be challenged and claimed back in insolvency. The court held in the first instance (07.05.2015, Az. 2-32 O 102/13) that the lawyers of an insolvent German company in the solar industry had to repay €4.5 million after the out-of-court restructuring failed.
1 Legal Developments
1.1 New Saudization Rules Proposed
Saudization is the colloquial term used to refer to Saudi Arabia’s official government policy of encouraging the employment of Saudi Arabian nationals in the private sector. The policy of Saudization is enforced and implemented through several programs and regulations in Saudi Arabia, including the Nitaqat Program.
A new milestone has been reached in the reform process of the Spanish Insolvency Act. On 25 May, the draft bill of the Law 9/2015, of urgent measures in insolvency proceedings, has finally been enacted as law. The new rule “validates” many of the modifications introduced by the latest Royal-Decree Laws, with some changes.
The Delaware Court of Chancery recently issued an opinion in Quadrant Structured Products Company1that addresses creditors’ rights to bring derivative lawsuits against directors and officers of a corporation. The Court held that Delaware law does not impose a continuous insolvency requirement and that the “traditional balance sheet test” is the appropriate test for determining solvency. The opinion also provides a roadmap on the current landscape under Delaware law for analyzing breach of fiduciary duty claims.