1. Commercial Chapter 11 Bankruptcy Filings Have Increased Significantly Year-Over-Year: There has been a significant increase in the number of commercial Chapter 11 cases (larger company filings) in 2024. By way of example, there were 1,894 commercial Chapter 11 filings (including subchapter V filings) during the first quarter of 2024, up 43% from the 1,325 total commercial chapter 11 filings during the first calendar quarter of 2023 according to data provided by Epiq Bankruptcy, the leading provider of U.S. bankruptcy filing data.

The Supreme Court issued a landmark and potentially far-reaching decision in Harrington v. Purdue Pharma L.P., No. 23-124 (“Purdue”), on June 27, 2024. We set forth the facts and our initial observations below, with a more complete description of the decision at the end of this bulletin.

What Did the Court Decide?

In a recent decision,the High Court ordered two former directors of BHS (British Home Stores) to pay at least £18m to creditors for their role in the collapse of the former high street giant.

This week:

Overview

1. Introducción

Este mes son prominentes los autos de homologación de planes de restructuración (en su mayoría no consensuales) que seguimos viendo. En ese mismo campo destacamos la desestimación de la impugnación del ya famoso plan de Torrejón Salud (plan con una única clase) que se ha instaurado como un "leading case" en la práctica. Los recurrentes son condenados en costas.

Todo esto y más resúmenes de resoluciones que nos han parecido interesantes a continuación.

2. Audiencias Provinciales

Background

The Times revealed in an article last month that, according to a report from the Audit Reform Lab, a think tank at the University of Sheffield, only a quarter of the 250 largest companies listed on the London Stock Exchange to become insolvent between 2010 and 2022 had a “going concern” warning included by their auditors in what would turn out to be their final set of accounts. Of those companies 38 also declared a dividend in those accounts.

On 1 July 2024, the Employment (Collective Redundancies and Miscellaneous Provisions) and Companies (Amendment) Act 2024 was commenced in full and is now law.

Releases of Sackler Family Too Broad and Not Authorized by the Bankruptcy Code

SUMMARY

Last week, in a 5-to-4 decision in the case ofHarrington, United States Trustee, Region 2 v. Purdue Pharma L.P, et al., the U.S. Supreme Court struck down the ability of bankruptcy courts to order non-consensual third-party releases (i.e., claims held by non-debtors against non-debtor third parties) as part of a Chapter 11 plan.