Collateral-order doctrine utilized in a case of first impression; court affirms broad equitable powers of a receiver

Securities and Exchange Commission v. Wealth Management, LLC, et al., 628 F.3d 323 (7th Cir. 2011)  

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Filed under:
USA, Capital Markets, Insolvency & Restructuring, Litigation, White Collar Crime, Reed Smith LLP, Collateral (finance), Security (finance), Market liquidity, Federal Reporter, Limited liability company, Hedge funds, Life insurance, Limited partnership, Bond credit rating, Pro rata, US Securities and Exchange Commission, Seventh Circuit
Authors:
Ann E. Pille
Location:
USA
Firm:
Reed Smith LLP
Claims trader loses out on cure payments where debtor’s approved plan permits postconfirmation rejection of executory contracts

ReGen Capital I, Inc. v. UAL Corporation, et al., (In the Matter of UAL Corporation, et al.), 635 F.3d 312 (7th Cir. 2011).

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Filed under:
USA, Insolvency & Restructuring, Litigation, Telecoms, Reed Smith LLP, Bankruptcy, Debtor, Unsecured debt, Security (finance), Interest, Federal Reporter, Default (finance), United Airlines, Second Circuit, United States bankruptcy court, Seventh Circuit
Authors:
Christopher O. Rivas
Location:
USA
Firm:
Reed Smith LLP
FAA registration law does not preempt state UCC where partially completed airplanes fail to satisfy FAA definition of “aircraft”

Mata, et al., v. Eclipse Aerospace, Inc. (In re AE Liquidation, Inc., et al.) Case No. 08-51891, 2011 BL 51047 (Bankr. D. Del. Feb. 28, 2011)

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Filed under:
USA, Delaware, Aviation, Insolvency & Restructuring, Litigation, Reed Smith LLP, Federal preemption, Debtor, Breach of contract, Fraud, Liquidation, Aircraft registration, Constructive trust, Federal Aviation Administration, Uniform Commercial Code (USA), Trustee, United States bankruptcy court
Authors:
Kathleen A. Murphy
Location:
USA
Firm:
Reed Smith LLP
Court vacates the foreclosure sale and awards damages, finding that the lender violated the automatic stay by proceeding with the sale where debtor guaranteed the loan, but had no ownership interest

In re Ebadi, No. 10-73702, 2011 WL 1257211 (Bankr. E.D.N.Y. March 30, 2011)

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Filed under:
USA, New York, Banking, Insolvency & Restructuring, Litigation, Reed Smith LLP, Punitive damages, Bankruptcy, Surety, Debtor, Interest, Debt, Mortgage loan, Foreclosure, Second Circuit, United States bankruptcy court
Authors:
Brian M. Schenker
Location:
USA
Firm:
Reed Smith LLP
Priming lien approved: new loan use would benefit the estate + debtor’s sizable equity cushion = adequate assurance

In re Olde Prairie Block Owner, LLC, Bankr. No. 10B22668 (Bankr. N.D. Ill. March 11, 2011)  

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Filed under:
USA, Illinois, Banking, Insolvency & Restructuring, Litigation, Reed Smith LLP, Credit (finance), Debtor, Unsecured debt, Tax credit, Property tax, Limited liability company, Debt, Foreclosure, Default (finance), Secured loan, United States bankruptcy court
Authors:
Ann E. Pille
Location:
USA
Firm:
Reed Smith LLP
Landlord’s corner

In re Heller Ehrman, LLP No. 10-CV-03134 2011 WL 635224 (N.D. Cal. Feb. 11, 2011)

In In re Heller Ehrman, LLP, the court analyzed whether the statutory cap imposed on a landlord’s damages resulting from the rejection of a lease should be computed based on the time remaining in the lease, or the full damages resulting from the rejection. While noting a split of authority, the District Court determined that the computation of the cap should be based on a temporal measure to be consistent with statutory language.

Filed under:
USA, California, Insolvency & Restructuring, Litigation, Real Estate, Reed Smith LLP, Debtor, Breach of contract, Landlord, Leasehold estate, Statute of limitations, Title 11 of the US Code
Authors:
Derek J. Baker
Location:
USA
Firm:
Reed Smith LLP
Court grants parent companies standing to sue lender as third-party beneficiaries of loan commitment agreements

Basic Capital Management, Inc. v. Dynex Commercial, Inc., 2011 WL 12067376 (Tex. Sup. Ct. J. Apr. 1, 2011)  

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Filed under:
USA, Texas, Banking, Insolvency & Restructuring, Litigation, Real Estate, Reed Smith LLP, Public company, Credit (finance), Breach of contract, Beneficiary, Real estate investment trust, Standing (law), Parent company, Texas Supreme Court
Authors:
Christopher O. Rivas
Location:
USA
Firm:
Reed Smith LLP
Trademark license agreement defines materiality, effectively establishing a perpetual executory agreement subject to perpetual rejection

Lewis Brothers Bakeries Incorporated and Chicago Baking Company v. Interstate Brands Corporation (In re Interstate Bakeries Corporation, et al.), Bk. Case No. 04-45818-11-JWV (W.D. Mo. March 21, 2011)

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Filed under:
USA, Missouri, Insolvency & Restructuring, Litigation, Trademarks, Reed Smith LLP, Debtor, Breach of contract, Federal Reporter, Eighth Circuit, United States bankruptcy court, Third Circuit
Authors:
Christopher O. Rivas
Location:
USA
Firm:
Reed Smith LLP
In a case of first impression, the Third Circuit holds that discounted cash flow analysis may be used as a ‘commercially reasonable determinant of value’ with respect to repurchase agreement acceleration under section 562

Agricole Corporate and Investment Bank New York Branch, f.k.a. Calyon New York Branch v. American Home Mortgage Holdings, Inc. (In re American Home Mortgage Holdings, Inc.), No. 09- 4295, 2011 WL 522945 (3d Cir. February 16, 2011)

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Filed under:
USA, Banking, Insolvency & Restructuring, Litigation, Reed Smith LLP, Bankruptcy, Mortgage loan, Investment banking, Liquidation, Cashflow, Default (finance), Market value, Valuation (finance), Discounted cash flow, Westlaw, Third Circuit
Authors:
Brian M. Schenker
Location:
USA
Firm:
Reed Smith LLP
What you need to know about the proposed new liquidation regime under Dodd-Frank

Under the proposed new insolvency regime created by Dodd-Frank, the FDIC may be appointed as receiver of a financial company if it is determined that the financial company is in default or in danger of default, and the failure of the financial company would have serious adverse effects on financial stability in the United States.The receiver is required to liquidate the failing financial company in a manner that imposes all losses on the company’s creditors and shareholders (rather than on taxpayers).

Filed under:
USA, Banking, Insolvency & Restructuring, Reed Smith LLP, Shareholder, Unsecured debt, Interest, Liquidation, Judicial review, Default (finance), Federal Deposit Insurance Corporation (USA), Dodd-Frank Wall Street Reform and Consumer Protection Act 2010 (USA)
Authors:
Peter S. Clark, II
Location:
USA
Firm:
Reed Smith LLP