Recreational cannabis is now legal in 19 states and Washington D.C., driving the growth of legal cannabis sales estimated at $33 billion this year—up 32% from 2021—and expected to reach $52 billion by 2026.[1] This movement signals that financial investment in cannabis is not abating but accelerating notwithstanding the impact of the lingering COVID-19 pandemic.

In the bankruptcy world, not all claims are created equal. Rather, certain special categories of claims have priority status and are not only paid ahead of other claims, but are also often paid in full. One such category of claims is found in Bankruptcy Code § 503(b)(9), which grants priority claim status for goods which were sold in the ordinary course of business and received by a debtor within the 20-day window leading up to the bankruptcy filing. The code section is very clear, however.

In In re Purdue Pharma, L.P., 1 U.S. District Court Judge Colleen McMahon of the Southern District of New York vacated Purdue Pharma’s confirmed plan of reorganization after finding that the bankruptcy court below did not have statutory authority to issue a confirmation order granting non-consensual third-party releases—namely for the benefit of the Sackler family, which owns Purdue.

A confession of judgment lets a creditor take a judgment without notice to the debtor, who usually first learns of the lawsuit when the creditor seizes his bank accounts and takes related steps. Here are strategies for representing commercial debtors facing such judgments. 

Your developer client borrows $5 million from a bank to improve a strip mall on Chicago’s northwest side. The developer signs a promissory note with a floating interest rate of 1 percent over the Wall Street Journal prime rate, and its principal shareholder signs a guaranty. 

This week's TGIF considers Stubbings v Jams 2 Pty Ltd [2022] HCA 6, in which the High Court overturned a finding by the Victorian Court of Appeal and confirmed that certificates of independent advice will not always protect lenders from an unconscionability claim.

Overview

“Trillions of dollars”: That’s the amount of civil penalty claims a group of 40 States are asserting against Johnson & Johnson for consumer protection law violations. [Fn. 1]

Such civil penalty claims:

In a recent case involving a default judgment to recover the sum of an outstanding loan, the Federal Court of Australia considered whether it had jurisdiction to set aside a bankruptcy notice issued against the guarantor of the loan and whether it had jurisdiction to extend the time for compliance with the bankruptcy notice.

Background

The Hon’ble Supreme Court has recently upheld a Judgement of the Division Bench of Tripura High Court in the case of Sri Subhankar Bhowmik vs Union of India(1) wherein it was held that a Decree Holder cannot be treated at par with Financial Creditors in a Corporate Insolvency Resolution Process (CIRP) initiated under the Insolvency and Bankruptcy Code, 2016 (Code).

Quite recently, a two Judges’ bench of the Hon’ble Apex Court in Indian Overseas Bank v. M/s. RCM Infrastructure Ltd. & Anr., Civil Appeal No. 4750/2021 (dated 18.05.2022), inter alia, determined on the issue of applicability of provisions under Section 14 of the Insolvency and Bankruptcy Code, 2016/ IBC/ Code to a proceeding initiated in terms of the SARFAESI Act, in particular, auction sale.