On 13 August 2014, the Irish High Court gave a judgment which addresses significant issues in examinerships and provides some clarity regarding loan acquisitions and the timing and other considerations for creditors when issuing letters of demand.
Background
On June 12, 2014, the U.S. Supreme Court unanimously held in Clark v. Ramekerthat an inherited individual retirement account (IRA) does not qualify for the “retirement funds” exemption in the Bankruptcy Code and is not excluded from a bankruptcy estate on that basis.
As noted in a previous Sutherland Legal Alert, the American Bankruptcy Institute has formed a Commission to Study the Reform of Chapter 11 (the Commission). To further its goal of proposing changes to modernize the Bankruptcy Code, the Commission formed a number of advisory committees, including one named the Financial Contracts, Derivatives and Safe Harbors Committee (the Committee).
Insolvency practitioners are routinely asked to adjudicate on claims to retention of title of goods supplied. This task often involves an analysis of whether the goods in question have become fixed to land, irreversibly mixed with other goods or whether they remain as identifiable items.
In the recent case of Re Moormac Developments Limited (in receivership)[1], the High Court gave further clarity to this area of the law.
The “safe harbor” provisions of the Bankruptcy Code protect firms that trade derivatives, and other participants in financial and commodity markets, from the rigidity that bankruptcy law imposes on most parties. Since their inception in 1982, the safe harbor statutes have gradually grown broader, to reflect a Congressional intent of protecting against secondary shocks reverberating through those markets after a major bankruptcy. The liberalizing of safe harbors traces – and may well be explained by – the rapidly expanding use of derivatives contracts generally.
Waterside Management Company Limited v Brendan Kelly and Asta Kelly[1]
In a long awaited landmark judgment, The European Court of Justice has today found in favour of ten former Waterford Crystal workers who alleged the Irish State had failed in their obligations to correctly implement European Directive 2008/94EC ('The Directive’) on the protection of employees in the event of the insolvency of their employer.
Yesterday the Minister for Justice, Alan Shatter, and Director of the Insolvency Service of Ireland (“ISI”), Lorcan O’Connor, launched the ISI’s public information campaign, which includes guides to the three new personal insolvency arrangements, its website and an information helpline for queries.
Oregon’s $29 million corporate excise tax claim against the taxpayers’ parent company was held to violate both the Due Process and Commerce Clauses of the U.S. Constitution by the U.S. Bankruptcy Court for the District of Delaware. Oregon claimed that Washington Mutual, Inc. (WMI) was liable for its subsidiaries’ tax because WMI had (as the parent corporation) filed consolidated corporate tax returns on behalf of itself and its subsidiaries and therefore could be held jointly and severally liable for the tax due.
On January 4, 2013, the U.S. District Court for the Northern District of Illinois issued an opinion that strikes a significant blow against the rights of futures customers that might otherwise enjoy the Bankruptcy Code’s safe harbor protections. The opinion, arising out of the Chapter 11 bankruptcy case of Sentinel Management Group, Inc. (Sentinel), fashions a new exception to the safe harbor protections in the event of distributions or redemptions to customers of a failed futures commission merchant (FCM).