Vigilantibus non dormientibus, æquitas subvenit.
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In Cortlandt St. Recovery Corp. v Hellas Telecom., S.A.R.L., 2014 NY Slip Op 24268 (Sup. Ct., N.Y. County 2014), the Supreme Court of the State of New York ruled on two important issues related to the right to sue for recovery with respect to notes issued under indentures. First, the court held that assignments of a right of collection, but not title to the claims or the note itself, are insufficient as a matter of New York law to confer standing upon an assignee to sue for recovery on a defaulted note.
On September 26, 2014, the United States Court of Appeals for the Second Circuit, overturning decisions by the Bankruptcy Court and the District Court for the Southern District of New York, held that the Bankruptcy Court was required to review under section 363 of the Bankruptcy Code the transfer of a claim by a chapter 15 debtor with a recognized foreign main proceeding pending in the British Virgin Islands (the “BVI”).1 In a case under chapter 15 of the Bankruptcy Code in which a foreign main proceeding has been recognized, section 1520(a)(2) of the Bankr
A case against a hedge fund, and one of its partners and in-house counsel, related to actions at a portfolio company and alleging breach of fiduciary duties survived a motion to dismiss. The portfolio company, alleged to be insolvent, was a credit derivative product company that had a subsidiary that wrote credit default swaps.
On Monday, October 6, 2014, the U.S. Supreme Court issued an order denying the petition for a writ of certiorari in the Jaffe v. Samsung case, also known as the Qimonda case.
Generally, the priority scheme in section 507 of the Bankruptcy Code dictates the order in which a creditor is paid.
In Snyder v. California Insurance Guarantee Association, the California Court of Appeal, First Appellate District, considered when the three-year statute of limitations for a cause of action against the California Insurance Guarantee Association (CIGA) accrues. The statute does not begin to run until a “covered claim” matures and is denied. CIGA’s denial in an answer to a complaint for declaratory relief did not satisfy this requirement.
With the reauthorization of the Higher Education Act (HEA) in full swing, the time is ripe for Congress to reconsider current laws prohibiting postsecondary institutions that declare bankruptcy from participating in the federal financial aid programs. Chapter 11, in particular, is a critical tool for institutions in distress, and may be needed now more than ever.
On September 29, 2014, the United States District Court for the District of Delaware affirmed an earlier decision of the Delaware Bankruptcy Court in In re Jevic Holding Corp.1 holding that a private equity sponsor was not liable for its portfolio company’s alleged violations of the WARN Act. The District Court ruling is good news for private equity funds and other investors with portfolio companies in distress.