The legislative framework applicable to insolvency and restructuring in Jersey has seen significant developments in recent years, with the introduction of the Companies Regulations No 8 2022 (the Regulations).
The Regulations provide additional powers to a company’s creditors – firstly, in relation to provisional liquidations (an emergency procedure designed to safeguard the assets of a failing company), and secondly in relation to creditors’ winding-ups.
.A look at relevant employment laws and litigation vulnerabilities that companies, including their owners, officers and directors, should consider before ceasing operations or filing for bankruptcy.
The New Jersey Appellate Division recently discharged a creditor’s judgment lien on the debtor’s property after the debtor declared bankruptcy and had the underlying debt discharged. SeeCooper Electric Supply Co., v. J & Jay Electric, Inc., 2020 WL 5496490 (N.J. Super. Ct. App. Div. Sept. 11, 2020). In 2008, plaintiff obtained a judgment against defendant and docketed the judgment. Although plaintiff received a writ of execution, the record was not clear on if plaintiff ever levied on defendant’s house.
This week, the Third Circuit issued an opinion in NJDEP v. American Thermoplastics Corp et al., No. 18-2865, which adds a new wrinkle on CERCLA section 113(f)(2), which bars non-settling parties from bringing claims for contribution against settling parties, while also placing new emphasis on CERCLA section 104 cooperative agreements in the context of settlements.
On 1 September 2016, Hanjin Shipping Co Limited ('Hanjin') successfully applied for and obtained an order whereby it was placed under rehabilitation. Such an order was obtained within 24 hours of the company making application to the Korean courts, without notice or input from other interested parties, most notably Hanjin's creditors.
Recent Events
The federal district court in New Jersey recently denied an appeal by maritime creditors of Hanjin to lift bankruptcy protections and allow arrest of Hanjin's vessels in and near U.S. ports. The federal district court judge agreed with the bankruptcy judge's grant of blanket protection to Hanjin and directed creditors of Hanjin to file claims in the Korean bankruptcy proceeding. Those claims are now due by October 25, 2016 in the Korean proceedings, according to an amended order issued by the Korean judge.
On September 9, 2016, Hanjin Shipping Co. won a ruling protecting its assets in the U.S. against creditors, while the shipping line proceeds with its reorganization in South Korea. Hanjin filed for relief under Chapter 15 of the Bankruptcy Code in the United States Bankruptcy Court for the District of New Jersey (U.S. Bankruptcy Court Judge John K. Sherwood in Newark, N.J.).
The U.S. Bankruptcy Court for the District of New Jersey recently held that a Cayman Islands collateralized-debt obligation issuer (“CDO”) could be a debtor under Chapter 11 of the U.S. Bankruptcy Code (the “Bankruptcy Code”) and declined to dismiss an involuntary case commenced against the CDO by certain noteholders on the grounds that the notes held by such noteholders were “non-recourse” notes. Below is a discussion of the court’s decision and its potential implications. The decision is currently being appealed.
Mark your calendars! The New Jersey Department of the Treasury recently announced a new one-time program authorized by recent legislation aimed at improving government-to-business interactions.
The Streamlined Business Reinstatement and Dissolution Program offers businesses that are currently in “revoked status” – due to not having complied with the state’s administrative reporting requirements – an expedited path to reinstatement or dissolution, both notoriously time-consuming and expensive processes.
Withdrawal liability under ERISA can be a significant factor considered by private equity funds in making investments in portfolio companies. And it becomes an even more significant factor if the private equity fund is determined to be a member of the company’s “control group” in which case the fund (and perhaps its partners) c