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In The Know: Un-Serta-inty - What now for uptiers in Europe?

On 31 December 2024, the Fifth Circuit Court of Appeals (the "Federal Court of Appeals") ruled that the uptiering transaction conducted by Serta Simmons Bedding LLC ("Serta") did not constitute an "open market purchase", reversing the 2023 summary judgment of the Bankruptcy Court for the Southern District of Texas (the "Texas Bankruptcy Court") that rejected the excluded lenders' claims for breach of the credit agreement. The Federal Court of Appeals also reversed the approval of certain plan provisions relating to an indemnity for the uptiering transaction.

European Union, USA, New York, Insolvency & Restructuring, Litigation, Baker McKenzie
New York District Court: Cap on Landlord Claims in Bankruptcy Applies to Claims Against Lease Guarantors, and Cap Should Be Calculated Using "Time Approach"

To prevent landlords under long-term real property leases from reaping a windfall for future rent claims at the expense of other creditors, the Bankruptcy Code caps the amount of a landlord's claim against a debtor-tenant for damages "resulting from the termination" of a real property lease.

USA, New York, Insolvency & Restructuring, Litigation, Real Estate, Jones Day, Drones, Bankruptcy, Landlord
New York Bankruptcy Court: Lockup Provision in Proposed Settlement Agreement Violated Bankruptcy Code's Disclosure and Solicitation Requirements

A bedrock principle underlying chapter 11 of the Bankruptcy Code is that creditors, shareholders, and other stakeholders should be provided with adequate information to make an informed decision to either accept or reject a chapter 11 plan. For this reason, the Bankruptcy Code provides that any "solicitation" of votes for or against a plan must be preceded or accompanied by stakeholders' receipt of a "disclosure statement" approved by the bankruptcy court explaining the background of the case as well as the key provisions of the chapter 11 plan.

USA, New York, Insolvency & Restructuring, Litigation, Jones Day, Bankruptcy
Navigating uncertainty in Belgium: Technology-driven businesses and the enigma of software licenses in insolvency

In today's rapidly evolving business landscape, businesses find themselves at the intersection of technological innovation and geopolitical and economic turbulence. Despite the increased reliance on software systems and digital infrastructure, it remains peculiar that in many EU Member States there's still no clear framework for handling software licenses in insolvency.

Belgium, Insolvency & Restructuring, IT & Data Protection, DLA Piper, Insolvency, European Court of Justice
Draft bill on transfer of undertaking in bankruptcy

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. 

Netherlands, Insolvency & Restructuring, Litigation, Loyens & Loeff, European Court of Justice, Court of Justice of the European Union
New York AG Secures Record $2 Billion Settlement in Crypto Case
  • New York AG Letitia James secured a $2 billion settlement with Genesis Global Capital, LLC, and related entities (collectively, “Genesis”), to resolve allegations that the bankrupt cryptocurrency firms defrauded investors, violating the Martin Act and New York Executive Law.
    • USA, New York, Banking, Insolvency & Restructuring, IT & Data Protection, Litigation, Cozen O'Connor, State attorney general, Cryptocurrency
    New York Legislature Proposes New Sovereign Debt Restructuring Bill

    The New York State Legislature recently proposed a bill, entitled the Sovereign Debt Stability Act, [1] intended to facilitate sovereign debt restructuring.

    USA, New York, Insolvency & Restructuring, Proskauer Rose LLP, US Congress, European Securities and Markets Authority
    New York’s Renewed Efforts to Pass Sovereign Debt Legislation (US)

    As discussed in our prior blog entitled “New York’s Sovereign Debt Restructuring Proposals,”[1] three bills were introduced in the New York state legislature to overhaul the way sovereign debt restructurings are handled in New York. Those bills sought to implement a comprehensive mechanism for restructuring sovereign debt, limit recovery on certain sovereign debt claims, and amend the champerty defense.

    USA, New York, Banking, Insolvency & Restructuring, Squire Patton Boggs, US Senate
    Contract law in focus: a look at current judgements and legal reforms

    This overview includes case law since mid-2022 and provides an overview of legal amendments that have a practical impact on national and international contracts.

    Insolvency-based rescission clauses

    European Union, Germany, Company & Commercial, Insolvency & Restructuring, Litigation, Trade & Customs, Noerr PartGmbB, Electric vehicle, Supply chain, Mediation, Due diligence, ESG, Insolvency, European Commission, European Court of Justice, Federal Court of Justice
    Austria: How insolvency avoidance actions in Austria could be affected by the proposed EU Directive on harmonisation of insolvency law

    Avoidance actions are a household staple for insolvency administrators to increase the insolvency estate in Austria. The current European Commission’s Proposal for a Directive (COM (2022)702) now aims to harmonise contestation rights in insolvency across all European member states.

    Austria, European Union, Insolvency & Restructuring, CMS Reich-Rohrwig Hainz, European Commission, European Court of Justice