The US Court of Appeals for the Third Circuit on September 10, 2024 issued its anticipated opinion in In re The Hertz Corp., with a majority holding that make-whole premiums constitute unmatured interest disallowed by the US Bankruptcy Code, but also finding that solvent debtors must pay creditors their full claims as dictated by contract, including make-whole and post-petition interest, before distributions can be made to equity.

In Sian Participation Corporation (In Liquidation) v Halimeda International Ltd [2024] UKPC 16, the Privy Council considered an appeal from the Court of Appeal of the Eastern Caribbean Supreme Court (BVI) as to whether a company should be wound up where the debt on which the winding up application is based is subject to an arbitration agreement and is said to be disputed and/or subject to a cross-claim.

The collapse of UK retailer British Home Stores ("BHS") in 2016 remains one of the most high-profile corporate insolvencies of recent times. It went from being a household name across the UK, with over 11,000 employees, to having reported debts of £1.3 billion, including a pension deficit of nearly £600 million. The group's demise saw the closure of some 164 stores nationwide and significant job losses.

Seven years after the British Home Stores Group Limited, a well known high street retailer, and its operating subsidiaries entered liquidation, the High Court has found two former directors liable for wrongful trading and misfeasance.

Background

The High Court has found that a borrower's debenture granted to a lender in respect of certain internet protocol (IP) addresses was a floating charge.

In a case brought by the liquidators, the High Court found two former directors liable for wrongful trading; that is, continuing to trade when they knew or should have known that there was no reasonable prospect of avoiding insolvency (section 214 of the Insolvency Act 1986).

In highly-anticipated twin rulings, the Hong Kong Court of Appeal has confirmed the approach which should be taken when a debtor opposes insolvency proceedings on the basis of a defence or claim which is subject to an arbitration clause (Re Simplicity & Vogue Retailing (HK) Co., Limited [2024] HKCA 299; Re

Can a creditor obtain a winding up order against a debtor company if the underlying dispute over the debt is subject to an arbitration agreement between the parties?

On April 12, 2024, the U.S. Supreme Court issued an important decision in the case of Macquarie Infrastructure Corp. v. Moab Partners, L.P., No. 22-1165. Justice Sotomayor, writing for a unanimous Court, ruled that “pure omissions are not actionable under Rule 10b-5(b).” In other words, a pure omission (i.e., where a speaker says nothing) cannot support a private claim under Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b–5, even if such an omission could constitute a violation of Item 303 of Regulation S-K (“Item 303”).

In a move that facilitates the seamless integration of cross-border insolvency proceedings between Singapore and Indonesia, Singapore’s International Commercial Court has for the first time granted recognition of Indonesian PKPU proceedings in Re PT Garuda Indonesia (Persero) Tbk [2024] SGHC(I) 1.