Four decades and several years ago, Congress repeals the Federal Bankruptcy Act of 1898 and replaces it with the Bankruptcy Reform Act of 1978, aka the “Bankruptcy Code.”[Fn. 1]
A decade later, Justices on the U.S. Supreme Court are still disparaging the new Bankruptcy Code as the “sweeping changes Congress instituted in 1978” and “the radical reforms of 1978.”[Fn. 2]
Over the span of two weeks in July 2022, two of the largest retail-facing cryptocurrency platforms, Celsius and Voyager, filed for chapter 11 bankruptcy protection.
Following are this week’s summaries of the Court of Appeal for Ontario for the week of November 14, 2022.
Another domino has fallen. Earlier this year, we wrote about the challenges facing the crypto industry that resulted in the bankruptcy filings of Three Arrows Capital, Celsius Network, and Voyager Digital. We noted that other crypto entities could also end up in chapter 11, and that prediction has proven correct.
The farming and agricultural industry has been dealing with financial challenges even before the pandemic. Those who were in financial jeopardy before the shutdown are forced to rely on taking on even more debt now just to survive. Currently, the sum of debt across the farming sector amounts to a staggering $496 billion according to the USDA.
Second Circuit Denies Appeal of Windstream Debtors’ Confirmation Order on Equitable Mootness Grounds
Bankruptcy is a formal process geared toward preserving stakeholder value. Often, the proceedings include negotiations between stakeholders that are arduous, time-consuming and expensive. Positioning the company for healthy and sustainable growth is often viewed as a postemergence priority, as companies naturally prioritize the near-term financial realities threatening their very survival.
Every now and then we get an example of how a process should work.
That’s exactly what we have, regarding confirmation of a contested Subchapter V plan, in the case of In re Lapeer Aviation, Inc., Case No. 21-31500 in the Eastern Michigan Bankruptcy Court.
In an opinion issued October 12, 2022, (Doc. 264), the Lapeer Court declares that, (i) most of the plan confirmation standards are satisfied, but (ii) the plan is deficient under two confirmation standards and, therefore, cannot be confirmed.
The Irish Minister for Enterprise, Trade and Employment signed into law the European Union (Preventive Restructuring) Regulations 2022 on 29 July 2022. This is the first significant piece of legislation dealing with corporate rescue in Ireland since 1990, when the jurisdiction's examinership process was first codified.
Layoffs often accompany corporate bankruptcy, and employers should be aware of the legal obligations that impact mass layoffs and plant closures. Most notably, the federal WARN Act requires employers to notify the workforce of a mass layoff, a temporary shutdown, or a closure of all or part of a business.
Employers that fail to provide adequate notice could be on the hook for damages of back pay and benefits-related compensation per employee for each day the company violated the WARN Act (up to 60 days).