On September 18, in an en banc review, the Court of Appeals for the Eleventh Circuit overruled, in part, seminal casesBarger v. City of Cartersville, 348 F.3d 1289 (11th Cir. 2003) and Burnes v. Pemco Aeroplex, Inc., 291 F.3d 1282 (11th Cir. 2002), adopting a totality-of-the-circumstances analysis when facing questions of judicial estoppel.
A Primer for Issuer Tender Offers, Debt Exchange Offers, Repurchases and Other Liability Management Matters
This primer is a one-stop comprehensive guide for any issuer seeking to restructure its non-convertible debt securities outside of bankruptcy. This publication:
• summarizes the U.S. federal securities laws, rules and regulations that apply to debt restructurings;
• describes various types of debt restructurings; and
• discusses various practical considerations arising in debt restructurings.
The ability of a trustee or chapter 11 debtor-in-possession ("DIP") to sell bankruptcy estate assets "free and clear" of competing interests in the property has long been recognized as one of the most important advantages of a bankruptcy filing as a vehicle for restructuring a debtor’s balance sheet and generating value. Still, section 363(f) of the Bankruptcy Code, which delineates the circumstances under which an asset can be sold free and clear of "any interest in such property," has generated a fair amount of controversy.
The Bankruptcy Protector
Chapter 11 debtors operate under various levels of uncertainty. Often a company is dependent upon others to provide financing or close transactions necessary for the company’s survival. Such was the case of Eclipse Aviation, which filed for Chapter 11 bankruptcy in November 2008, with an (apparent) agreement to sell itself to its largest shareholder.
The U.S. Bankruptcy Appellate Panel for the Eighth Circuit recently affirmed a bankruptcy court’s holding that a creditor held an unenforceable lien against a debtor’s real property because the property was owned by the entireties and the lien was thus avoidable under Bankruptcy Code § 522(f)(1).
A copy of the opinion is available at: Link to Opinion.
The Bankruptcy Code prohibits a chapter 13 debtor from modifying a mortgage lien on the debtor's principal residence. Even in situations in which a secured creditor fails to file a proof of claim or otherwise participate in the bankruptcy proceeding, the Bankruptcy Code allows a secured creditor's lien on a primary residence to pass through the bankruptcy unaffected. However, a recent decision from a bankruptcy court in Texas illustrates the risks to secured creditors of blind reliance on these statutory protections.
Last week, in Assured Guaranty Corp. v. Fin. Oversight and Mgmt. Bd. for Puerto Rico, No. 17-1831, 2017 U.S. App. LEXIS 18387 (1st Cir., Sept. 22, 2017), the U.S. Court of Appeals for the First Circuit issued a noteworthy decision in the Puerto Rico quasi-bankruptcy proceedings. Overturning the district court’s ruling, the Court of Appeals held that the Puerto Rico Oversight, Management, and Economic Stability Act (“PROMESA”), 48 U.S.C.
The Bottom Line
