The composition of the Top 10 List of public bankruptcy filings for 2014 indicates that the U.S. has largely left behind the fraud, excess, abuse, and improvidence that dominated the bankruptcy landscape during the 2007–08 financial crisis and the ensuing Great Recession. Continuing a trend that began in 2012, only a single representative from the banking and financial services industry made the cut.
Argentina—The long-running dispute over the payment of Argentina’s sovereign debt has been particularly active in recent weeks and months.
Events Leading Up to Argentina's Default
Compared to much of the rest of the world, the United States had the most positive economic, business, and financial news in 2014.
In December 2013, the U.S. Court of Appeals for the Second Circuit held as a matter of first impression in Drawbridge Special Opportunities Fund LP v. Barnet (In re Barnet), 737 F.3d 238 (2d Cir. 2013), that section 109(a) of the Bankruptcy Code, which requires a debtor "under this title" to have a domicile, a place of business, or property in the U.S., applies in cases under chapter 15 of the Bankruptcy Code.
Debt-for-equity swaps and debt exchanges are common features of out-of-court as well as chapter 11 restructurings. For publicly traded securities, out-of-court restructurings in the form of "exchange offers" or "tender offers" are, absent an exemption, subject to the rules governing an issuance of new securities under the Securities Exchange Act of 1933 (the "SEA") as well as the SEA tender offer rules.
For the benefit of our clients and friends investing in European distressed opportunities, our European Network is sharing some current developments.
Recent Developments
A "structured dismissal" of a chapter 11 case following a sale of substantially all of the debtor's assets has become increasingly common as a way to minimize cost and maximize creditor recoveries. However, only a handful of rulings have been issued on the subject, perhaps because bankruptcy courts are unclear as to whether the Bankruptcy Code authorizes the remedy. A Texas bankruptcy court recently added to this slim body of jurisprudence. InIn re Buffet Partners, L.P., 2014 BL 207602 (Bankr. N.D. Tex.
The Commonwealth of Puerto Rico's efforts to deal with more than $70 billion in debt have been a magnet for media scrutiny during the last two years. A question frequently asked in connection with the island territory's struggles to stay afloat is whether Puerto Rico, as an unincorporated territory of the U.S., could resort to a bankruptcy filing as a means of alleviating its financial problems.
The mainstream media have been trying to predict, on almost a daily basis, the causes of, and the winners and losers (mostly focused on the latter category) resulting from, the current volatility in oil and gas prices.
Europe has struggled mightily during the last several years to triage a long series of critical blows to the economies of the 28 countries that comprise the European Union, as well as the collective viability of eurozone economies. Here we provide a snapshot of some recent developments regarding insolvency, restructuring, and related issues in the EU.