In a recent decision1 involving TerreStar Networks, Inc., and its affiliates (“TerreStar” or the “Debtors”), the United States Bankruptcy Court for the Southern District of New York held that the Debtors’ noteholders held a valid lien on the economic value of a license granted to TerreStar by the Federal Communications Commission (“FCC”) and that nothing in Article 9 of the New York Uniform Commercial Code (the “NYUCC”) or Section 552 of the Bankruptcy Code invalidated that lien.
I am a director and employee of a small media company which has now been put into liquidation by the chief executive due to mounting debts. The company is due to close any time soon, which means I will then be unemployed. What rights, if any, do I have as an employee and is there any scope for compensation.
On August 22nd, the Federal Reserve Board proposed a two-year phase-in period for most savings and loan holding companies ("SLHCs") to file Federal Reserve regulatory reports with the Board and an exemption for some SLHCs from initially filing Federal Reserve regulatory reports. Under the Dodd-Frank Act, supervisory and rulemaking authority for SLHCs and their non-depository subsidiaries was transferred from the OTS to the Board. The Board previously sought comment on whether to require SLHCs to submit the same reports as bank holding companies.
Several states have recently added provisions to their insurance rehabilitation and liquidation acts which address the rights of parties to certain derivatives transactions with an insurance company in the event that an order of rehabilitation or liquidation is entered against the insurer. In short, these laws allow parties to exercise certain early termination and close-out netting provisions without regard to the applicable stay mechanism under state insurance insolvency law.
A recent opinion from the Bankruptcy Court in the Eastern District of North Carolina adds another chapter to the continuing saga of attacks lodged against the validity of deeds of trust encumbering real property owned by debtors. In re Deuce Investments, Inc.
On August 24th, the Third Circuit issued an opinion warning lawyers of the hazards posed by over-reliance upon automated, computerized communications between counsel and client. In doing so, it reinstated an order sanctioning a lawyer and her law firm for making false filings with the bankruptcy court. In re: Niles C. Taylor.
Under the Pension Protection Act of 2006, the Employee Retirement Income Security Act of 1974 (ERISA) was amended to provide that the date a plan sponsor files a bankruptcy petition will be treated as the termination date when a defined benefit plan is terminated in bankruptcy.
On August 15, 2011, Evergreen Solar ("Evergreen"), filed chapter 11 petitions for Bankruptcy in the United States Bankruptcy Court for the District of Delaware. According to the Declaration of Evergreen's CEO, Michael El-Hillow (the "Declaration" or "Decl."), filed in support of its bankruptcy petitions, Evergreen incorporated in Delaware in 1994 and manufactures "multi-cystalline silicon wafers." The company uses its silicon wafers in the production of photovoltaic solar cells, which in turn are installed in solar panels under the Evergreen trade name. Decl. at 3.
The U.S. Bankruptcy Court for the District of Delaware ruled that an affiliate that held an indirect ownership interest in, and was a lender to, an employer could be liable for severance payments under the Federal WARN Act. In order for liability to apply to the affiliate, the affiliate and employer need to be found to constitute a "single employer" for Federal WARN Act purposes.
Lenders and mortgage holders may be surprised to learn that a New York bankruptcy court voided the foreclosure sale of non-debtor property where the debtor filed for bankruptcy with no legitimate intent to reorganize. In a case of first impression, In re Ebadi1 addresses a common scenario: a foreclosure action against multiple parties, including a borrower not in bankruptcy and a guarantor in bankruptcy.