Trusts can protect your assets, to a certain extent. Foreign and domestic asset protection trusts can protect them even more, if you structure them correctly. The jail time starts when you wait until you already have creditors banging on the door before you relinquish control or a beneficial interest in one of these trusts. Unfortunately for one person in California this April, courts call that a “fraudulent transfer,” especially if you do not seem to be getting anything of value in return (other than, of course, being able to exclude assets from a bankruptcy).

In Citibank, N.A., London Branch v Oceanwood Opportunities Master Fund and others, the English High Court recently addressed what constitutes “control” for purposes of the disenfranchisement clause ubiquitous in New York law indentures. While the Court determined that “control” is necessarily a fact-based question to be viewed in light of the particular circumstances, the judgment offers several helpful conclusions which will be good news to any lenders having or seeking control positions in note tranches.

Facts of the case

EBH Topco, LLC, along with thirty-one (31) subsidiaries and affiliates, has filed a petition for relief under Chapter 11 in the Bankruptcy Court for the District of Delaware (Lead Case No. 18-11212).

The U.S. Court of Appeals for the Fifth Circuit held that where a mortgagee rescinded a notice of intent to accelerate and then filed a foreclosure action without first issuing a new notice of intent to accelerate, it failed to meet its burden to show clear and unequivocal notice of intent to accelerate prior to filing suit, and therefore was not entitled to foreclosure judgment.

Accordingly, the Fifth Circuit reversed the ruling of the trial court granting summary judgment in favor of the bank, and dismissed the foreclosure action.

Our January 22 post discussed “a long-running issue concerning the treatment of trademark licenses in bankruptcy” and its resolution in the January 12 decision of the First Circuit in Mission Product Holdings, Inc. v. Tempnology, LLC.[1] On May 17, the U.S.

Here’s an aggregation of my daily Twitter posts from April 13-22, 2018, linking to important cases, articles, and news briefs that restructuring professionals will find of interest. Don’t hesitate to reach out and contact me to discuss any posts.

April 13 – 22, 2018

BK CASES:

The Rockport Company, LLC, along with nine (9) affiliates and subsidiaries, has filed a petition for relief under Chapter 11 in the Bankruptcy Court for the District of Delaware (Lead Case No. 18-11145). Rockport, based in West Newton, MA, is a designer, distributor and retailer of comfort footwear in more than fifty (50) markets worldwide.

The U.S. Court of Appeals for the Eleventh Circuit recently vacated a trial court’s dismissal of a mortgagee’s deficiency claims and remanded to the trial court to determine whether the voluntary dismissal of a bankrupt debtor’s Chapter 11 case without a discharge had any effect on the mortgagee’s right to pursue its pre-petition deficiency claims.

Arecont Vision Holdings, LLC, along with two affiliates and subsidiaries, has filed a petition for relief under Chapter 11 in the Bankruptcy Court for the District of Delaware (Lead Case No. 18-11142). Arecont, based in Glendale, CA, is a developer and manufacturer of megapixel camera technology for security and surveillance use.

On April 17, 2018, the U.S. Bankruptcy Court for the Southern District of New York (the “Court”) issued a decision requiring CohnReznick LLP (“CohnReznick”) to produce documents requested by the foreign representatives (the “Foreign Representatives”) in the chapter 15 case of Platinum Partners Venture Arbitrage Fund (International) Limited (in Official Liquidation) (the “International Fund”).