Foreign financial institutions that trade dollar-denominated securities on the secondary market may not appreciate that they could be forced to defend an action arising from such a transaction in a U.S. court. That is what happened, however, to an Austrian bank that purchased a $10 million interest in a syndicated $1.5 billion term loan on the secondary market. In a recent decision, the bankruptcy court in Motors Liquidation Co. Avoidance Action Trust v. JPMorgan Chase Bank, N.A. (In re Motors Liquidation Co.), Adv. Pro. No. 09-00504 (MG), 2017 WL 632126 (Bankr. S.D.N.Y. Feb.

The U.S. Supreme Court held today in a 6 to 2 decision that “structured dismissals” resolving Chapter 11 bankruptcy proceedings cannot deviate from the Bankruptcy Code’s priority scheme without the consent of the affected parties – which means that businesses must ensure workers receive their unpaid wages as part of any such resolution. Specifically, the Court rejected a structured dismissal that left a group of WARN Act plaintiffs without any compensation, telling employers, essentially, that they must squeeze blood from a stone to compensate their workers.

Ten Cardinal Rules for a Proper Repossession Author: Franklin Drake Smith Debnam Narron Drake Saintsing & Myers LLP Raleigh, North Carolina WHITEPAPER TEN CARDINAL RULES FOR A PROPER REPOSSESSION by Franklin Drake Introduction: Creditors too often expose themselves needlessly to disgruntled debtors' claims for wrongful repossession. Avoiding the legal expense of defending such claims is just a matter of correct procedures and common sense. Here are 10 common sins and how to stay righteous. I. BE SURE YOU REALLY DO HAVE AN ENFORCEABLE LIEN ON THE GOODS! A.

Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware handed down an important ruling last week that turned aside most of an unusual challenge to the fees and expenses of an indenture trustee in the long-running Nortel chapter 11 case. The dispute has been watched closely by financial institutions that serve as trustees on bond issuances. (Kelley Drye & Warren LLP represented a large creditor in the Nortel case but took no part in the issues discussed here).

On March 10, 2017, the U.S. District Court for the Southern District of New York issued a Memorandum Order, in which it affirmed a controversial bankruptcy court ruling. The district court agreed with the bankruptcy court that Sabine Oil & Gas Corp., an upstream oil and gas producer, could reject a number of its gathering contracts with midstream energy companies.

(7th Cir. Mar. 13, 2017)

The Seventh Circuit affirms the district court’s dismissal of the appeal. The debtor failed to appeal the bankruptcy court’s order within the 14-day period set forth in Bankruptcy Rule 8002(a)(1). The court discusses authority holding that courts do not have equitable powers to contradict bankruptcy statutes and rules. Opinion below.

Judge: Easterbrook

Attorney for Debtor: Randy Joseph Netzer

Attorney for Appellee: Sean Michael Murphy

Miller Act, you’re not in Kansas anymore. In a recent bankruptcy case, the court in Kansas addressed issues of jurisdiction and venue raised by claims asserted by the debtor, an electrical contractor on a federal government project.

The bankruptcy court denies the defendants’ motion to dismiss, with the exception of one claim for equitable subordination against one of the defendants. The complaint filed by the trustee asserted counts for veil piercing, fraud and fraudulent transfer, preference avoidance, breach of fiduciary duty, and a demand for accounting and turnover. Opinion below.

Judge: Moberly

Attorney for Trustee: Mark A. Warsco

Attorneys for Defendants: Alerding Castor Hewitt LLP, Michael J. Alerding, Julia E. Dimick, Mitchell Alan Greene, Anthony Frederick Roach; Abraham Murphy

The U.S. Court of Appeals for the Fourth Circuit recently held that certain deposits and wire transfers into a bankrupt debtor’s personal, unrestricted checking account in the ordinary course of business were not “transfers” under § 101(54) of the Bankruptcy Code, affirming the district court’s and bankruptcy court’s entry of summary judgment in favor of the bank in an adversary proceeding brought by the bankruptcy trustee.

“[C]ourts may account for hypothetical preference actions within a hypothetical [C]hapter 7 liquidation” to hold a defendant bank (“Bank”) liable for a payment it received within 90 days of a debtor’s bankruptcy, held the U.S. Court of Appeals for the Ninth Circuit on March 7, 2017.In re Tenderloin Health, 2017 U.S. App. LEXIS 4008, *4 (9th Cir. March 7, 2017).