Voyager Digital Assets, Inc., a leading cryptocurrency brokerage and lending platform, filed for Chapter 11 bankruptcy protection on July 5, 2022 in the Southern District of New York following a recent financial crisis impacting the crypto industry, which investors are calling the “crypto winter.” The filing was followed by the Chapter 11 bankruptcy of Celsius Networks. While the situation is fluid, these two filings could be the beginning of a series of bankruptcies by major cryptocurrency companies.

The Bankruptcy Protector

Bankruptcy Basics for New and Non-Bankruptcy Attorneys

This entry is part of Nelson Mullins’s ongoing “Bankruptcy Basics” blog series that is intended to address foundational aspects of bankruptcy for non-bankruptcy practitioners and professionals. This entry will discuss how ipso facto clauses are treated in bankruptcy.

Imagine you are the vendor to an entity that has just filed for protection under chapter 11 of the Bankruptcy Code. Your contract documents include the following default provision:

In a matter of first impression relating to an important bankruptcy claims administration issue, Judge Sean H. Lane of the United States Bankruptcy Court for the Southern District of New York, recently denied the ability of a court appointed claims agent to sell and profit from providing direct access to publicly available claims register information. The unsuccessful purchaser of such information was XClaim Inc. (“Xclaim”), a relatively new venture that is seeking to develop a web-based claims trading platform.

The Eleventh Circuit has held that amounts paid post-petition for an administrative expense claim under Section 503(b)(9) of the Bankruptcy Code do not reduce the “new value” otherwise available to the creditor as a defense to a preference claim. Auriga Polymers Inc. v. PMCM2, LLC, 2022 U.S. App. LEXIS 19761 (11th Cir. July 18, 2022).

I. Introduction

Proceedings against personal guarantors find their origin in Section 128 of the Contract Act, 1872 which deals with the co-extensive liability of a surety. It has long been considered that a surety’s liability to pay the debt is not removed by reason of the creditor’s omission to sue the principal debtor. Such a creditor is not bound to exhaust his remedy against the principal debtor before suing the surety, and a suit may be maintained against the surety even though the principal debtor has not been sued.

There have been several so-called "uptier" transactions over the last several years, where lenders have provided "rescue financing" to a distressed company senior in priority to existing debt. While there has been significant commentary about whether such financings are contractually permitted, there have been few decisions analyzing challenges to such transactions.¹ In Bayside Capital Inc. v. TPC Group Inc.

The Supreme Court of the United States granted certiorari on June 27, 2022, to determine whether section 363(m) of the Bankruptcy Code—concerning appellate review of bankruptcy court sale orders—is jurisdictional or only limits the remedy an appellate court may fashion. This issue has split the circuit courts of appeals. The case is set for oral argument in the October 2022 term.

中国半導体大手の紫光集団は破産の発表後、新たな株主を取り込んでいるが、鴻海集団傘下の富士康工業互聯網（FII）も新株主として名を連ねており、今後総額約98億元（約435億台湾ドル）の出資を行う予定である。これにより鴻海集団の半導体事業ポートフォリオは大きな飛躍を遂げると見られる。

中国メディアの報道によると、紫光集団は7月11日に会社株式及び新任取締役、監査役、CEOに関する工商変更登記手続きを完了させている。これまで株主だった清華控股及び北京健坤投資集団は完全に撤退し、智路資本及び建広資産管理により立ち上げられた北京智広芯控股が紫光集団全ての株式を継承した。

業界の分析によれば、紫光集団の事業領域はメモリやIC設計に及び、同集団は中国最大のメモリチップメーカー・長江存儲や、独立系の携帯端末用チップメーカー・紫光展鋭の株主でもある。鴻海集団の紫光集団への出資は、鴻海集団のメモリ及び通信用チップ事業への参入、さらにはファウンドリ／製造、IC設計、OSATがワンストップサービスで行われることを意味する。メモリや通信用チップはいずれも現在鴻海集団で不足している半導体資源であるため、メモリーや通信に関する事業ポートフォリオを拡大できれば、今後半導体や電気自動車事業において大きなアドバンテージとなる。

Good afternoon.

Following are this week’s summaries of the Court of Appeal for Ontario for the week of July 11, 2022. There were many interesting cases this week.

In Humphrey v. Mene Inc., the Court allowed an appeal in part and reduced damages for wrongful dismissal from twelve months to seven as a result of the plaintiff’s failure to reasonably mitigate by accepting another comparable position seven months after she had been dismissed. The awards of aggravated and punitive damages were upheld.

With priming transactions experiencing a resurgence over the past few years, there have been a number of different routes taken by lenders with one goal in mind - Assemble a majority position and exchange, refinance or otherwise abandon their existing positions to move up the capital structure, which in turn helps increase their blended return on their exposure to a borrower and prevents a different configuration of investors from grabbing the “high ground” above them.