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Victoria funding (EMC-III) PLC: (I can’t get no) satisfaction

Another day, another CMBS transaction declares an insolvency related event of default (after the REC6 default), this time based on the ‘balance sheet’ event of default.

United Kingdom, Insolvency & Restructuring, Reed Smith LLP, Liability (financial accounting)
Jumping across the pond: syndicating European borrower debt in U.S. markets (Part 3 of 3)

Recent uncertainty in the European financial markets has led many European borrowers to look to the U.S. debt markets for liquidity.  However, U.S.

European Union, USA, Insolvency & Restructuring, Reed Smith LLP, Debtor, Market liquidity, Debt, Broadcast syndication
Second Circuit interprets securities contract safe harbor broadly for second time in three years

CASE SNAPSHOT

USA, Insolvency & Restructuring, Litigation, Reed Smith LLP, Security (finance), Safe harbor (law), Second Circuit
Fourth Circuit concludes that certain commissions and margin interest payments are protected from avoidance by "stockbroker defense"

CASE SNAPSHOT

In a case of first impression, the Fourth Circuit determined that broker commissions shown to be reasonable and customary parts of settling stock sales constitute "settlement payments" and that the payment of margin interest constitutes "margin payments" under section 546(e) of the Bankruptcy Code such that these types of payments are immune from avoidance and recovery by a bankruptcy trustee.

FACTUAL AND PROCEDURAL BACKGROUND

USA, Capital Markets, Insolvency & Restructuring, Litigation, Reed Smith LLP, Debtor, Interest, Margin (finance), Commission (remuneration), Fourth Circuit
Data Protection Act – obligations of liquidators

A judgment recently handed down from the High Court clarifies the obligations of liquidators under the Data Protection Act 1998, providing them with greater personal protection from fines or other sanctions.

Reed Smith acted for the liquidators in their application for directions.

Background

United Kingdom, Insolvency & Restructuring, IT & Data Protection, Litigation, Reed Smith LLP, Data Protection Act 1998 (UK)
‘Super priority’ of financial support directions overturned in Supreme Court of England and Wales

Summary

The Supreme Court has today allowed an appeal against the decision of the Court of Appeal (14 October 2011) which, in certain circumstances in an insolvency situation, would have accorded “super priority” to a financial support direction made by the Pensions Regulator.

United Kingdom, Employee Benefits & Pensions, Insolvency & Restructuring, Litigation, Reed Smith LLP, The Pensions Regulator (UK), Pensions Act 2004 (UK), Pensions Act 1995 (UK), Supreme Court of the United States
In re Lehman Brothers Inc.: repo claims fall outside of SIPA protection

As part of the Lehman Brothers Inc. ("Lehman") bankruptcy, the Bankruptcy Court for Southern District of New York ("Court") determined that three banks’ (the "Claimants") claims in relation to repurchase agreements ("repos") were not "customer claims" entitled to customer protection under the Securities Investor Protection Act of 1970 ("SIPA").

USA, New York, Capital Markets, Insolvency & Restructuring, Litigation, Reed Smith LLP, Security (finance), Lehman Brothers, United States bankruptcy court
Bankruptcy Court concludes that renewable power purchase and sale agreement is a "forward contract" entitled to safe harbor protections

CASE SNAPSHOT

USA, Insolvency & Restructuring, Reed Smith LLP, Bankruptcy, Debtor, Renewable energy, Title 11 of the US Code, United States bankruptcy court
Tenth Circuit joins Fourth Circuit in holding that absolute priority rule applies to individual chapter 11 cases

Dill Oil Company, LLC v. Stephens, No. 11-6309 (10th Cir., Jan. 15, 2013)

CASE SNAPSHOT

The Court of Appeals for the Tenth Circuit, in a case of first impression before the court, joined the Fourth Circuit in holding that the absolute priority rule remains applicable in individual chapter 11 cases.

FACTUAL BACKGROUND

USA, Insolvency & Restructuring, Litigation, Reed Smith LLP, Debtor, Unsecured debt, Secured creditor, United States bankruptcy court, Fourth Circuit, Tenth Circuit
Creditor defeats preference action based on ‘new value’ defense

In re ESA Environmental Specialists, Inc., 2013 WL 765705 (4th Cir., Mar. 1, 2013)

CASE SNAPSHOT

USA, Insolvency & Restructuring, Insurance, Litigation, Projects & Procurement, Reed Smith LLP, Letter of credit, Debtor, Collateral (finance), Debt, Liquidation, Certificate of deposit, European Space Agency, Fourth Circuit