Di Cioccio v Official Trustee in Bankruptcy (as Trustee of the Bankrupt Estate of Di Cioccio) [2015] FCAFC 30

Whether inconsistency between Div 4B of Pt VI, s 58(1)(b) in Div 4 of Pt IV and s 116 of Pt VI of the Bankruptcy Act 1966 (Cth)

An appeal from the decision of Di Cioccio v Official Trustee in Bankruptcy [2014] FCA 782.

In a memorandum decision dated May 4, 2015, Judge Vincent L. Briccetti of the United States District Court for the Southern District of New York affirmed the September 2014 decision of Judge Robert D. Drain of the United States Bankruptcy Court for the Southern District of New York, confirming the joint plans of reorganization (the “Plan”) in the Chapter 11 cases of MPM Silicones LLC and its affiliates (“Momentive”). Appeals were taken on three separate parts of Judge Drain’s confirmation decision, each of which ultimately was affirmed by the district court:

DERIVATIVES/ASSET MANAGEMENT/FINANCIAL INSTITUTIONS ADVISORY & FINANCIAL REGULATORY CLIENT PUBLICATION 12 May 2015 Bank Recovery and Resolution Directive – Implications for Repo and Derivative Counterparties The Bank Recovery and Resolution Directive (BRRD)1 introduces an EU-wide regime for recovery and resolution planning for, and for resolution action to be taken in respect of, banks and large investment firms (typically the large sell-side institutions) (FIs)2.

On January 5, 2015, HM Treasury published the Bank Recovery and Resolution Order 2014 (“BRRO”) and the Banks and Building Societies (Depositor Preference and Priorities) Order 2014 (“BBSO”). The Banking Act 2009 (Restriction of Special Bail-in Provision, etc.) Order 2014 and the Banking Act 2009 (Mandatory Compensation Arrangements following Bail-in)  Regulations 2014 were published in December 2014.

On December 19, 2014, the UK Insolvency Service reported that two former directors of Connaught Asset Management, Nigel Walter and Michael Anthony Davies, have both been disqualified from controlling or managing a company for a period of 9 and 7 years respectively. The former directors allowed the misuse of up to £106m of investor money by failing to review the progress on loans made with monies borrowed from funds and not ensuring the money was repaid to the fund following loan completion.

The press release is available at:

Turner v Gorkowski [2014] VSCA 248

Whether application seeking a declaration for or against the title of the trustee to a trustee in bankruptcy under s 58(1)(a) of the Bankruptcy Act 1966 (Cth) is a ‘special federal matter’ within the meaning of s 6(1) of the Jurisdiction of Courts (Cross Vesting Act) 1987 (Cth).

On appeal, the Victorian Supreme Court of Appeal transferred a proceeding initiated in the Supreme Court to the Federal Court.

Di Cioccio v Official Trustee in Bankruptcy [2014] FCA 782

Examination of whether shares purchased from a bankrupt’s income below the threshold amount in respect of which he was required to make contributions to his trustee under Division 4B of Part 6 of the Bankruptcy Act 1966(Cth) is within the meaning of “after acquired property” in s 58(1).

Dealing a major blow to the trustee’s efforts to recover fraudulent transfers on behalf of the bankruptcy estate of the company run by Bernard Madoff, Judge Jed S. Rakoff of the United States District Court for the Southern District of New York held in SIPC v. Bernard L. Madoff Investment Securities LLC¹ that the Bankruptcy Code cannot be used to recover fraudulent transfers of funds that occur entirely outside the United States.

Facing the imminent bankruptcy of the federal Highway Trust Fund (the “HTF”) and the specter of delays and reductions in payments from the HTF to the States, the US Congress last week passed the Highway and Transportation Funding Act of 2014, which extended federal surface transportation programs and funding through May 2015. We summarize below the key elements of the Act.

SHAREHOLDERS ARBITRATION
In a historic USD 50 billion award rendered on July 18, 
2014, an Arbitral Tribunal constituted pursuant to the 
Energy Charter Treaty held unanimously that the Russian 
Federation breached its international obligations under the 
Energy Charter Treaty by destroying Yukos Oil Company 
and appropriating its assets. 
The Tribunal, applying the UNCITRAL Arbitration Rules and sitting in The 
ague under the auspices of the Permanent Court of Arbitration ordered the