Administrations, including "pre-packs", are not capable of constituting "insolvency proceedings...instituted with a view to the liquidation of the assets of the transferor" within the meaning of Regulation 8(7) of TUPE. Where there is a sale of an undertaking by an administrator, the employees assigned to the undertaking will automatically transfer to the buyer and receive unfair dismissal protection.

Key facts

Receiverships are on the rise in Ohio and across the Midwest. In most cases, the appointment of a receiver heralds the close of a business. Receiverships are also commonly part of a foreclosure proceeding. Calfee's Business Restructuring and Insolvency practice group lawyers have extensive experience with both state and federal court receiverships and we can assist you in determining the impact of a receivership on your business.

On March 17, 2010 we reported on the decision of a New York intermediate appellate court to apply New York law to disallowed claims under insurance policies issued by Midland Insurance Company, an insolvent multiline insurer placed into liquidation in New York.

The New York Court of Appeals decision on April 5, in the Midland Insurance Company liquidation (In re Liquidation of Midland Insurance Company1) is an important affirmation of policyholder rights. In this decision, New York’s highest court held that a policyholder is entitled to a claim and policy-specific choice of law analysis in the liquidation process, rejecting the Midland liquidator’s effort to make a blanket application of New York law to Midland’s 38,000 policyholders.

Washington Governor Christine Gregoire has signed into law a series of changes to the state Receivership Act that will make it easier (and possibly cheaper) for creditors to utilize the Receivership Act as a tool to resolve troubled loan situations with their borrowers. The revisions will become effective 90 days after the Legislature adjourns, making July 24, 2011, the likely effective date. The changes clarify a number of points that previously puzzled both judges and practitioners.

Creditors' Rights

The latest numbers on bankruptcy filings in 2010 have been released, and 1.53 million Americans filed for bankruptcy protection last year, an increase of 9% over 2009’s figures. This number is the highest number of bankruptcy filings since the passage of the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) became law in 2005. In that year, 2 million Americans filed bankruptcy in order to file before BAPCPA’s restrictions on bankruptcy filings took effect.  

On April 18th, the FDIC released a report examining how it could have structured an orderly resolution of Lehman Brothers Holdings Inc. under the orderly liquidation authority of the Dodd-Frank Act had that law been in effect at the time.

An ongoing development in bankruptcy practice makes it important for credit managers to determine exactly which entity in a corporate group is actually the customer purchasing and paying for goods or services.

In a decision released on March 29, 2011, CDX Liquidating Trust v. Venrock Assocs., et al., 2011 U.S. App. LEXIS 6390 (7th Cir. March 29, 2011), the United States Court of Appeals for the Seventh Circuit, reversing the district court’s ruling, held that a director’s disclosure of a conflict, in and of itself, is insufficient to protect that director from liability for breach of fiduciary duty or disloyalty arising from that conflict.

Make whole premiums sound simple; they are prepayment premiums that are supposed to “make you whole.” More precisely, make whole premiums are intended to protect noteholders (or other debt holders) from the loss of future fixed coupon interest payments due to the early repayment of debt if market interest rates have declined in the interim.