In an appeal involving a Chapter 12 bankruptcy, the U.S. Court of Appeals for the Eighth Circuit recently affirmed that the borrower’s use of the 20-year treasury bond rate sufficiently ensured that the total present value of future payments to the lender over the plan period equaled or exceeded the allowed value of the claim.
A copy of the opinion in Farm Credit Services of America v. William Topp is available at: Link to Opinion.
On July 28, 2023, Judge Michael Kaplan of the Bankruptcy Court for the District of New Jersey issued an opinion granting motions to dismiss LTL Management LLC’s second chapter 11 case, finding that it was filed in bad faith due to a lack of imminent and immediate financial distress. See In re LTL Mgmt., LLC, No. 23-12825 (MBK), 2023 WL 4851759 (Bankr. D.N.J. July 28, 2023). Judge Kaplan’s decision follows the U.S. Court of Appeals for the Third Circuit’s dismissal of LTL’s first chapter 11 bankruptcy case in January 2023.
Introduction
In a landmark decision issued in July, Re Leading Holdings Group Limited [2023] HKCFI 1770, the Hong Kong Courts addressed, for the first time, the right of an investor of a global note to present a winding-up petition as a contingent creditor.
The Case
The relevant company was incorporated in the Cayman Islands and was listed on the Hong Kong Stock Exchange. It issued 12% Senior Notes which were due in 2022 and the petitioner was the beneficial owner of a sub-interest in those notes.
The NSW Court of Appeal has allowed Garuda Indonesia to invoke sovereign immunity to foil an insolvency proceeding brought by aircraft lessor Greylag Goose Leasing.
The Court’s decision is Greylag Goose Leasing 1410 Designated Activity Company v P.T. Garuda Indonesia Ltd [2023] NSWCA 134 (14 June 2023) (Bell CJ, Meagher JA and Kirk JA agreeing).
Although a non-insolvency case the recent case of PACCAR Inc & Ors v Competition Appeal Tribunal & Ors (“PACCAR”) has caused waves in the litigation market (including insolvency litigation market) following the Supreme Court finding that litigation funding agreements (LFAs) where funders recover a percentage of the amount awarded to a claimant are damaged based agreements (DBAs) – which- unless the LFA complied with the Damages Based Agreements Regulations 2013 (“DBA Regs”) means that they are unenforceable.
As expected, the scope of directors' duties whilst a company is in financial difficulties has been the source of further consideration by the Court. The recent case of Hunt v Singh [2023] EWHC 1784 raised the question as to whether, following the Supreme Court decision in BTI 2014 LLC v Sequana SA, a director's duty to take into account the interests of creditors arises where the company is at the relevant time insolvent if a disputed liability comes to fruition.
Over the past year, digital asset investors have become acutely aware of asset custody and counterparty credit risks due to the high-profile bankruptcies of Voyager, Celsius, BlockFi, and FTX. These investors have found that, at times, their assets may be stuck in a bankruptcy proceeding for years. However, these investors—now bankruptcy claim holders—have options for more immediate liquidity.
Litigation between Mr and Mrs Brake, Axnoller Events Ltd and various other parties has been the subject of a significant number of judgments covering a wide range of legal issues. The underlying facts are convoluted but can be briefly summarised for the purpose of the recent decision of the Supreme Court in Brake & Anor v The Chedington Court Estate Ltd [2023] UKSC 29 as follows.
This week, the Ninth Circuit addresses whether text messages can violate the Telephone Consumer Protection Act’s prohibition on “prerecorded voice” messages, and it considers whether debtors who paid statutory fees under an unconstitutionally nonuniform bankruptcy provision are entitled to a refund.