Pursuant to the Companies (Miscellaneous Provisions) (COVID-19) Act 2020 (the COVID Act), “exceptional provision” to the operation of certain parts of the Companies Act 2014 (the Act) was made for a specific period of time, which period could be extended by order of the Government (the Interim Period). Yesterday, the government announced that it was extending the Interim Period until 31 December 2022.

A Bírósági Határozatok Gyűjteményében közzétett Gfv.VII.30.365/2020/5. számú határozatában a Kúria arra a következtetésre jutott, hogy az adós és a hitelező közötti szerződés felszámoló általi, Cstv. 47. § (1) bekezdés szerinti felmondása nem jogellenes, ebből következően az adóssal szemben a szerződés alapján a felmondás tényére tekintettel kártérítési igény nem érvényesíthető. A kártérítési felelősség megállapítására ugyanis jogellenes magatartás hiányában nem kerülhet sor.

In its unanimous decision, Ernst & Young Inc. v. Aquino, the Ontario Court of Appeal modified the common law doctrine of corporate attribution in the bankruptcy and insolvency context to uphold a decision of Ontario Superior Court’s Commercial List, which ordered a corporate officer and his associates, whom collectively orchestrated a fraudulent invoicing scheme, to repay over $30 million to company creditors pursuant to s. 96 of the Bankruptcy and Insolvency Act (“BIA”).

Background

A key bankruptcy-related response to the pandemic has ended as the increased debt limits under subchapter V of chapter 11, passed by Congress in the CARES Act, have expired. In an effort to provide bankruptcy relief and access to subchapter V of chapter 11 of the Bankruptcy Code to a greater number of small businesses, Congress raised the debt limit for subchapter V eligibility from the original $2,725,625 million to $7.5 million via the CARES Act, passed in March of 2020.

“I did not want you to hear this on the news for the first time, but we are filing for bankruptcy next week.” “This is a difficult call to make. We are going out of business and will probably be filing a chapter 7 in the next couple of days.” Needless to say, bankruptcy is problematic for a licensor: the licensee may cease performing, the royalty stream may run dry, and the licensee or a trustee could attempt to sell or assign the license in bankruptcy to an undesirable licensee, or even a competitor.

A recent case out of the Eastern District of California addressed the split in authority on whether an inaccurate credit report alone is enough to establish a concrete injury in fact for purposes of Article III standing.

When one party can unilaterally prevent a bankruptcy filing – action steps and best practices

Commodities Alert

Restructuring Alert

Winter is here, with the attendant risk of another major weather event impacting the energy production industry, and, specifically, the wind power generation industry in Texas. Last year, Winter Storm Uri significantly disrupted the Texas power grid and forced several energy originators, distributors, and buyers to consider restructuring alternatives.

In August 2021 the Italian government, led by Mario Draghi, enacted a Law Decree (no. 118) to issue “urgent measures to deal with companies’ and entrepreneurs’ crises and subsequent restructuring and other urgent measures for the justice system.” On October 23, 2021, the Law Decree no. 118 was converted into Law no. 147/2021 (Law 147). The new tools introduced by Law 147 have been put in place to deal with entrepreneurs in crises that need an urgent turnaround, including during the ongoing COVID-19 emergency.

The full written judgment of Sir Alastair Norris in respect of the sanction of the Part 26A restructuring plan for Amicus Finance PLC (in administration) was belatedly handed down last week. As we reported in August (linked here), Amicus is the first company in administration to implement a Part 26A restructuring plan, which was fiercely contested by one of the creditors of the Group, Crowdstacker.