A Pennsylvania appellate court has affirmed the liquidator’s determination that a group excess insurance policy issued by Reliance is a reinsurance policy and thereby entitled to a low level of priority of payment from the now insolvent Reliance estate. At issue was a claim by the Alabama Insurance Guaranty Association for reimbursement from the estate for a claim it had paid to a general contractors fund.
Judge Drain’s recent decision confirming the Momentive Performance Materials Inc. plan is just the latest in a series of recent cases involving “make whole” premiums. As in several of the recent cases, the lenders lost because the contract did not clearly enough provide for the make whole premium in the event of an acceleration rather than prepayment.
Recreational marijuana is legal in two states—Washington and Colorado—and medical marijuana is legal in another twenty-one states. Colorado alone has over 500 marijuana dispensaries and that number is on the rise. However, as the marijuana industry continues to grow, federal law still prohibits the use of marijuana. So what happens when a marijuana business becomes insolvent? Does it have the right to avail itself of the protections of the Bankruptcy Code?
Why it matters
Loan agreements and bond indentures often contain "make-whole" provisions, which provide yield protection to lenders and investors in the event of a repayment prior to maturity. They accomplish this by requiring the borrower to pay a premium for pre-payment of a loan. This allows lenders to lock-in a guaranteed rate of return when they agree to provide financing. Borrowers also benefit since the yield protection allows lenders to offer lower interest rates or fees than they would absent such protection.
The Supreme Judicial Court of Massachusetts has answered a lingering question about the interpretation of Massachusetts’s fine art consignment law, G.L. c. 104A, § 2. Laying to rest any doubts about whether a written agreement is required at the time of delivery to create a consignment under the statute, the SJC has interpreted the 2006 amendments to the law for the first time and clarified the roles of everyone involved.
In re Denman, 513 B.R. 720 (Bankr. W.D. Tenn. 2014) –
A chapter 13 debtor was a member of a limited liability company. Another member sought relief from the automatic stay in order to exercise a right to acquire the debtor’s membership interests pursuant to the LLC operating agreement.
On September 8th, 2014 the Court of International Trade dismissed an importer’s challenge to CBP’s liquidation of entries subject to anti-dumping duties. The importer claimed the entries should have been subject to suspension of liquidation but were not. The court determined that regardless of what should have occurred, the liquidation took place, and the importer did not take any action to reverse or negate that action.
In two recent decisions, ASARCO LLC v. Goodwin, 756 F.3d 191 (2d Cir. 2014) and ASARCO LLC v. Union Pacific Railroad Co., 755 F.3d 1183 (10th Cir. 2014), the Second Circuit and the Tenth Circuit each held that a reorganized bankruptcy debtor's direct contribution claims against other potentially responsible parties under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), 42 U.S.C.
If the summer whizzed by too fast and you are still using your old Circular 230 disclaimer on emails and correspondence, it is time to fix that.