Welcome to Distressed Debt Legal Insights, Ropes & Gray’s source of timely insights for professionals navigating the complex world of liability management and special situations finance. In this issue we discuss the first major decision of 2026: STG Logistics. The January 3 opinion primarily denies the motions to dismiss brought by defendants seeking to validate their October 2024 drop down plus double dip transaction.
Transaction Details and Procedural History
Welcome back to Distressed Debt Legal Insights, Ropes & Gray’s source of timely insights for professionals navigating the complex world of liability management and special situations finance. In this issue we will provide a summary of certain aspects of the noteholder litigation in Wesco that culminated in the recent district court decision approving the 2022 uptier transaction and reversing the bankruptcy court’s decision.
The Original Transaction
In this issue, we spotlight the unfolding litigation between the UCC and Oaktree in TPI Composites’ ongoing bankruptcy, which appears to be headed for a settlement. This case is unusual in that the uptier transformed former equity holders into senior creditors rather than elevating existing lenders.
The Unsecured Creditors Committee Challenge
Welcome back to Distressed Debt Legal Insights, Ropes & Gray’s new source of timely insights for professionals navigating the complex world of liability management. In this edition, we’re looking at how Anthology resolved an objection to its proposed non-pro rata DIP rollup.
Background
Anthology filed for Chapter 11 on Sept. 29 in the Southern District of Texas with a restructuring support agreement signed by 87% of first out lenders and 68% of second out lenders.
Judge Parker of the U.S. Bankruptcy Court for the Western District of Texas recently issued an order in the case of Hilltop SPV, LLC, granting debtor Hilltop SPV LLC’s (“Hilltop”) motion to reject a Gas Gathering Agreement (“GGA”) with counter-party Monarch Midstream, LLC (“Monarch”).[1] This decision allows Hilltop to reject the GGA while allowing Monarch to retain the covenants that run with the land post-rejection.
Harrington v. Purdue Pharma L.P., 144 S. Ct. 2017 (June 27, 2024)
In a decision delivered on 7 June 2024 (2024TALCH02/00950) (the Decision), the Luxembourg District Court provided for substantive clarifications regarding article 10 of the Luxembourg Law of 7 August 2023 on the continuation of businesses and modernisation of insolvency law (the Restructuring Law). This article empowers the Court to appoint judicial agents (mandataires de justice) in case of serious and aggravated misconduct (manquements graves et caractérisés) by the debtor or its corporate bodies, threatening the continuity of the business.
Op 27 mei 2024 is het Wetsvoorstel overgang van onderneming in faillissement in internetconsultatie gegaan (de WOVOF). De WOVOF beoogt de werknemersbescherming bij faillissement te vergroten, met name in geval van een doorstart. De WOVOF introduceert onder andere een verplichting voor de doorstarter om (in beginsel) alle werknemers uit de failliete onderneming over te nemen. Deze en andere maatregelen worden in dit nieuwsbericht nader toegelicht.
Huidige regeling en aanleiding WOVOF
On 27 May 2024, the draft bill on transfer of undertaking in bankruptcy (in Dutch: Wetsvoorstel overgang van onderneming in faillissement, the WOVOF) was made available for internet consultation. The WOVOF aims to increase the protection of employees in case of bankruptcy, and more particular, in case of a restart (in Dutch: doorstart). The WOVOF introduces, amongst other things, an obligation for the acquirer in a restart to (in principle) offer employment to all employees from the bankrupt company. This and other measures will be discussed in detail in this this news blog.
The Belgian Constitutional Court addressed in a recent judgment the treatment of creditors in a collective debt settlement procedure. The central question was whether a different treatment of creditors, depending on whether they benefit from security over financial collateral, can be justified by objective criteria and whether this aligns with the constitutional principles of equality and non-discrimination.
Since the court finds the different treatment unconstitutional, the judgment impacts the enforcement rights of pledgees of financial collateral granted by private individuals.