In Rushbrooke UK Ltd (the Company) v Designs Concept Ltd (Designs) [2022] EWHC 1110 (Ch), the Court struck out injunction proceedings to restrain the presentation of a winding up petition as the instructing director did not have Company authority.
Background
Proving a transaction was to defeat creditors might be easier, but recovering assets under section 588FF of the Corporations Act which are not specifically part of the impugned transaction remains a challenge.
On July 5, 2022, New York-based cryptocurrency exchange, Voyager Digital Holdings, Inc. along with its publicly traded Canadian affiliate, Voyager Digital Ltd., filed a petition for relief under Chapter 11 of the Bankruptcy Code in the Bankruptcy Court for the Southern District of New York (Case No. 22-10943). The company reports $1 to $10 billion in both assets and liabilities.
While the M&A pipeline remains strong and the usual acquisition models for listed companies (takeovers and schemes of arrangement) remain active, as talk turns to economic headwinds and rising interest rates, it is worth bearing in mind the third possible pathway to acquire a listed company in a distressed context: the “DOCA takeover”.
IN BRIEF
The court sanctioned one of two potential schemes of arrangement for Amigo Loans Ltd (Amigo) and approved a plan that provided for two possible outcomes.
Background
Amigo provided guarantor loans to customers with poor credit scores. Amigo owed customers and the Financial Ombudsman Service £375 million for customer complaints and was insolvent.
The Supreme Court has agreed to hear a dispute between Mall of America and Transform Holdco LLC as to whether a lease Transform acquired at a bankruptcy sale can be challenged after that sale has closed. Sections 363(b)(1) and 363(m) of the Bankruptcy Code are at play here. Section 363(b)(1) generally permits a bankruptcy trustee, after notice and hearing, to use, sell, or lease property that belongs to the bankruptcy estate outside of the ordinary course of business.
In its June 6, 2022 opinion in Siegel v. Fitzgerald, the United States Supreme Court resolved a circuit split and invalidated a 2017 statute that increased U.S. Trustee fees in 48 states—but not Alabama or North Carolina—as unconstitutional under the uniformity requirement of the Constitution’s Bankruptcy Clause. See Siegel v. Fitzgerald, 596 U.S. ___ (2022).
U.S. Trustee Fees, a History
Justice Stephen G. Breyer is now retired from the U.S. Supreme Court, serving from August 3, 1994, to June 30, 2022.
One of his legacies—and an exceedingly important one—is this: he has worked, successfully, to erase “public rights” from the lexicon of controlling bankruptcy law.
What follows is a summary of how “public rights” came to be part of that lexicon, and how Justice Breyer works to get it erased.
“PUBLIC RIGHTS” BEGINNING—Northern Pipeline
On 14 June 2022, the Hong Kong Court of Final Appeal (the “CFA”) handed down a long-awaited and landmark judgement in Shandong Chenming Paper Holdings Limited v Arjowiggins HKK 2 Limited[2022] HKCFA 11, which would have significant implications to companies incorporated in offshore jurisdictions but listed in Hong Kong.
In a ruling issued on 3 March 2022 (IX ZR 78/20) the German Federal Court (BGH) has again raised the requirements for proving that a debtor, when making a payment, intended to disadvantage their creditors.
Background