On 24 February, the Government published draft regulations that, if implemented, will impose new restrictions on pre-pack administration sales to connected parties. For all `substantial disposals' (which will include `pre-pack' sales) to connected parties, taking place within eight weeks of the administrators' appointment, the administrators will either need creditor consent or a report from an independent `evaluator'.
Context
In a recent decision, the United States District Court for the Southern District of New York upheld a bankruptcy court order that enjoined a plaintiff holding an asbestos claim from pursuing a state court products liability claim against the successor to Manville Forest Products Corporate (“MFP”). Notably, the Court reaffirmed that a claim relating to prepetition exposure to asbestos is a prepetition claim, even though the injury may not have manifested itself until after the petition date.
In a recent decision, the United States District Court for the Southern District of New York upheld a bankruptcy court order that enjoined a plaintiff holding an asbestos claim from pursuing a state court products liability claim against the successor to Manville Forest Products Corporate (“MFP”). Notably, the Court reaffirmed that a claim relating to prepetition exposure to asbestos is a prepetition claim, even though the injury may not have manifested itself until after the petition date.
These case summaries first appeared in LexisNexis’ Insolvency Case Alerter. They represent some of the more interesting insolvency decisions to have been published recently.
This summary covers:
On 28 January, the English High Court handed down the first ever judgment sanctioning a restructuring plan under Part 26A of the Companies Act 2006 (“CA 2006”) (“Plan”) invoking the new cross class cram down procedure introduced into UK law in June 2020.
Introduction
At the end of last year judgment was handed down by Pat Treacy J in a matter notable for the unusual attitudes of a director towards the company’s director’s loan account. By the time the company entered into administration, the loan account was overdrawn to the tune of £1.35m, with the director having withdrawn funds to (amongst other things) finance the purchase and maintenance of a personal yacht.
The new German stabilizing and out of court restructuring regime came into effect on 1 January 2021. The "Stabilization and Restructuring Framework of Companies Act", known as StaRUG1, heralds a new phase in the German restructuring landscape, introducing a framework of tools including a new restructuring plan, which will enable debtors to restructure and cram down minority creditors outside of German insolvency proceedings for the first time.
While there has been much fuss over the recent ruling by the United States District Court for the Southern District of New York in In re Nine West LBO Securities Litigation1 due to its potential ramifications for director liability, as we explored in Part I of our series on this case here, court watchers have paid less attention to the court’s treatment of officer liability and the interes
In January 2020, we analyzed a split among the Circuit Courts regarding whether a non-debtor holding a debtor’s property on the petition date has an affirmative obligation under section 362(a)(3) of the Bankruptcy Code to return that property to the debtor immediately following the filing of the bankruptcy petition.