On June 2, 2010, the Third Circuit overruled longstanding precedent interpreting the definition of a “claim” under the Bankruptcy Code. In JELD-WEN, Inc. v. Van Brunt (In re Grossman’s Inc.), No. 09-1563, slip op., (3d Cir. June 2, 2010) an en banc panel rejected the state law accrual theory of claims recognition established in Avellino & Bienes v. M. Frenville Co. (Matter of M. Frenville Co.), 744 F.2d 332 (3d Cir. 1984), in favor of the more widely followed conduct test theory.

On July 22, 2008, the US Court of Appeals for the Second Circuit affirmed denial of the motion of Parmalat S.p.A. ("New Parmalat") to extend an injunction provided to its predecessor, Parmalat Finanziaria, S.p.A., under Bankruptcy Code section 304, against securities fraud actions.1 Although the appeal addressed the issue of injunction in the context of superseded Bankruptcy Code section 304, this decision and the underlying lower court opinion signify other issues of broader import, including the need for careful plan drafting and the complexities inherent in cross-border cases.

The Bankruptcy Code limits the amount a landlord may recover from a bankrupt tenant for damages caused by the termination of a lease of real property. But what if the tenant trashes the landlord's property before turning over the premises? Does the damage limitation apply to the landlord's claim for the cost of cleaning up the mess?

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (the “BAPCPA”) created an additional category of administrative expenses

About a year ago, I completed the most exhausting marathon of my life serving as the chief lawyer during the cross-border restructuring and chapter 11 of Waypoint Leasing, an Ireland-based helicopter leasing company. I joined Waypoint Leasing shortly after it started operations in the newly formed helicopter leasing industry. After the first few years of meteoric growth, the collapse in oil & gas prices hit the helicopter industry hard. We soon found ourselves dealing with bankrupt customers and eventually reached the brink of financial distress ourselves.

Securing support from principal creditors makes all the difference between a chapter 11 restructuring that saves a troubled shipping company and one that sinks it.

When a shipping company's financial distress is extreme, it must work fast to preserve value and stem losses. The use of chapter 11 by shipping companies to coerce principal creditors to support an unfavorable restructuring where ownership refuses to share risk is costly, value destructive and generally fruitless.

Companies that plan to sell goods or services to a debtor in bankruptcy should be aware of a recent case decided by the Court of Appeals for the Eleventh Circuit, holding that a trustee may avoid a debtor’s post-petition transfers of cash collateral if such transfers were made without the consent of the secured party or court order.1

In a recent opinion,1 the U.S. District Court for the Southern District of New York emphasized that foreign confidentiality statutes do not deprive an American court of the power to order a party subject to its jurisdiction to produce evidence — even though the act of production may be considered a criminal offense in a foreign jurisdiction and subject the party to serious consequences, including imprisonment and fines.

Background

Many participants in the multibillion-dollar distressed-debt trading markets were hoping that Federal District Court Judge Shira A. Scheindlin would permit expedited review of her ruling immunizing a purchaser of a claim against a debtor in bankruptcy from objections to the claim based upon the conduct of a prior holder of the claim.

In a recent ruling likely to be of great interest to debtors and creditors alike, the United States District Court for the Northern District of Georgia (the “Court”) ruled in MC Asset Recovery v. Southern Company1 (the “Southern Co. Litigation”) that fraudulent transfer claims held by a bankruptcy trustee or debtor in possession under the Bankruptcy Code continue to be viable at the conclusion of a bankruptcy case, even if all creditors’ claims have already been satisfied in full pursuant to a plan of reorganization.