This panel discussion at INSOL London 2022, moderated by Debra Dandeneau, Chair of the Global Restructuring & Insolvency Group at Baker McKenzie, explored how rescue financing works in different parts of the globe and provided insights on some issues that alternative capital providers typically face. The panellists also brought a wide variety of experience and views to creating an ideal system that promotes restructuring and rescue financing.

Some of the key takeaways and insights were:

On June 29, 2022, New York City-based Madison Square Boys & Girls Club, Inc. (the “Club”), a non-profit aimed to save and enhance the lives of underserved boys and girls through after school programming and youth development services, 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. 22-10910).

The Bankruptcy Protector

In 2019, Congress enacted the Small Business Reorganization Act. This legislation created a new type of Chapter 11 reorganization under which certain businesses with total debts less than a certain threshold (currently $7.5 million) could reorganize. These provisions, known as Subchapter V eliminated certain requirements for confirmation of a reorganization plan and include other changes to make small business reorganization quicker and less expensive.

With the beginnings of the coronavirus pandemic, 2020 brought an onslaught of retail bankruptcy cases. Lord & Taylor, Ascena Brands, Neiman Marcus and JC Penny, among many others – not less than 52 in total. As the economy recovered from the initial shock of the pandemic, the number of retail bankruptcy cases subsided in 2021. According to reports, there were 21 retail cases in 2021 as retail traffic began returning to pre-pandemic levels. 2022, however, brings new pressures on the global economy, and certain that may strike the retail industry with force.

Celsius Networks (“Celsius”) became the latest cryptocurrency platform to raise market temperatures by halting all withdrawals, swaps and transfers from and between its customers’ accounts on June 12, 2022. Celsius touted a next wave of “unbanking,” operating a lending platform allowing the holders of digital assets the opportunity to earn a significantly high returns on those assets.

Overview

Recently, in Shady Bird Lending, LLC v. The Source Hotel, LLC (In re The Source Hotel, LLC), Case No. 8:21-cv-00824-FLA (C.D. Ca. June 8, 2022), the Central District of California District Court adopted the majority view that a non-income producing property could be a “single asset real estate,” or SARE, debtor. The district court held that a hotel, which was not yet producing income, met the definition of a SARE.

Background

We developed this checklist as a tool and guide to necessary and optional elements to negotiate and document the principal agreement or deal document in an international or cross-border Joint Venture (“JV”) between a U.S. party or parties and one or more non-U.S. parties.

In a decision approved for publication, addressing the intersection of New Jersey Court Rule 4:5-4 and 11 U.S.C. 524(a), the New Jersey Appellate Division recently held that a bankruptcy discharge precluded a creditor from obtaining a judgment of personal liability and debtor’s failure to plead that defense did not waive it. Vadim Chepovetsky and Svetlana Nashtatik v. Louis Civello, Jr. , No. A-0476-21 (App. Div. Jun. 16, 2022).

Background

As noted in our prior Alerts, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), which became law March 27, 2020, included various COVID-19 pandemic-related bankruptcy relief provisions which sunsetted on Saturday, March 27, 2021, but were extended by the “COVID-19 Bankruptcy Relief Extension Act of 2021” (“2021 Extension Act”) through March 27, 2022. By the President’s June 21, 2022, signature of the Bankruptcy Threshold Adjustment and Technical Corrections Act (the “BTATC Act”), Pub. L. No. 117-151, ___ Stat.