Bankruptcy

  • August 14, 2017

    Puerto Rico Creditors Assail Board's Discovery Opposition

    Senior bondholders with secured interests in Puerto Rico sales tax revenues said Friday that the commonwealth and a federally appointed board overseeing the territory's landmark bankruptcy proceedings should be compelled to produce discovery after improperly refusing to provide testimony concerning an alleged failure to protect the investors’ secured collateral.

  • August 14, 2017

    7th Circ. Denies Sentinel's 2nd Clawback Attempt

    The Seventh Circuit on Monday again denied a bid by the trustee for Sentinel Management Group to claw back $14.5 million from a creditor, three years after the court rejected the same request, this time finding an “indefinite and internally inconsistent” bankruptcy court order can’t be used to bar a previously allowed transfer.

  • August 14, 2017

    TerraVia Wants IP Award Row Sent To Del. Bankruptcy Court

    Bankrupt algae-based food producer TerraVia Holdings Inc. asked a district court judge in Delaware to transfer two lingering intellectual property suits to bankruptcy court late Friday, saying closure is critical to the company’s planned Chapter 11 auction.

  • August 14, 2017

    CRS Trustee Files Clawback Suit Over Discounted Biz Sales

    The trustee for bankrupt human resources contractor Corporate Resource Services Inc. filed amended adversary claims Friday that insiders had sold CRS-owned businesses for millions of dollars below their market value shortly before its bankruptcy.

  • August 14, 2017

    Sungevity Pushes For Structured Dismissal Despite Objection

    The bankruptcy estate for rooftop solar firm Sungevity pushed back Monday against the U.S. trustee’s office’s opposition to its proposed structured dismissal, arguing that without the relief, it is forced to choose between two bad choices, neither of which would yield much of a recovery for creditors.

  • August 14, 2017

    High Court Asked To Examine Ch. 11 Rent Assignment Interest

    The U.S. Supreme Court has been asked to review a Sixth Circuit ruling that, in Chapter 11 bankruptcies of real estate properties, lenders who are assigned rents can have exclusive dibs on them, and they are not property of the bankruptcy estate.

  • August 11, 2017

    7th Circ. Says Casino Execs To Blame For Lost License

    An Illinois federal court did not err when it handed down a $272 million judgment against six Chicagoland casino executives who allegedly caused their company to lose its gambling license and fall into bankruptcy, the Seventh Circuit said Friday.

  • August 11, 2017

    Bankrupt Sexual Health Chain Gets OK To Tap Lender Cash

    A Delaware bankruptcy judge gave sexual health and wellness retailer Peekay Acquisition Inc. the nod Friday to tap lender cash to launch its Chapter 11 case, which it hopes will culminate in a sale of the business saddled with more than $72.5 million in debt.

  • August 11, 2017

    Westinghouse Faces Worker Suits Over Nuke Plant Shutdown

    Westinghouse Electric Co. LLC, the contractor behind a canceled project to build two new nuclear reactors in South Carolina, and two of its units were hit with class complaints by former employees who said they lost their jobs without notice.

  • August 11, 2017

    Takata's Japanese Parent Gets Temporary Litigation Shield

    A Delaware bankruptcy judge gave Takata’s Japanese parent, which has petitioned for Chapter 15 recognition, temporary protection Friday from collection efforts and lawsuits in the United States, with a larger fight over whether that shield should become permanent set for September.

  • August 11, 2017

    Rakoff Puts $360M Transmar Bank Fraud Case On Fast Track

    Transmar Commodity Group Ltd. CEO Peter G. Johnson, his son and a financial executive at the belly-up New Jersey cocoa distributor denied charges Friday that they engaged in a massive $360 million bank fraud, and Manhattan U.S. District Judge Jed S. Rakoff put the case on track for an April trial.

  • August 11, 2017

    Rajaratnam Fights Galleon Fund Trustee's $135M Fraud Suit

    Convicted insider trader Raj Rajaratnam and two other executives with his defunct hedge fund Galleon Group asked a New York federal judge on Thursday to dismiss a bankruptcy trustee's $135 million fraud case against them, saying the complaint "completely distorts the reality" of the company's wind-down.

  • August 10, 2017

    Breitburn Gets OK To Use DIP Proceeds For Swap Deals

    A New York bankruptcy judge entered an order Wednesday allowing Breitburn Energy Partners LP to enter into swap agreements with its debtor-in-possession lenders and related entities to hedge potential losses from fluctuations in oil and gas prices.

  • August 10, 2017

    Feds' Claim Against Crawfish Importer Can Skip Ch. 11 Stay

    The U.S. government can bypass the automatic stay in Rupari Food Services Inc.’s ongoing bankruptcy and have a $2.8 million judgment entered against the debtor for claims it cheated on customs taxes years ago, the U.S. Court of International Trade ruled Thursday.

  • August 10, 2017

    Trustee For Columbia House Trying To Claw Back Millions

    The liquidating trustee for the parent of onetime music megadistributor Columbia House filed legal actions Wednesday seeking $19 million in clawbacks and suing four former executives for breach of fiduciary duty over an improvident loan.

  • August 10, 2017

    Justices Rescind Grant To Hear Ch. 11 Debt Rebranding Case

    The U.S. Supreme Court said Thursday that it erred in June when it took up a North Carolina bankruptcy dispute over whether debt used to finance the acquisition of a golf and residential real estate development was correctly recharacterized as equity after the original loan was sold to settle a foreclosure.

  • August 10, 2017

    Takata's Japanese Parent Seeks Ch. 15, Litigation Halt

    Takata’s corporate parent in Japan, already under a form of bankruptcy protection in its home country, sought Chapter 15 recognition Thursday in Delaware, opening another front in the company’s quest to halt the firestorm of litigation over defective Takata air bag inflators linked to at least a dozen deaths.

  • August 10, 2017

    Sexual Health Chain Peekay Plans Sale In Del. Ch. 11

    Sexual health and wellness retailer Peekay Acquisition Inc. opened a Chapter 11 sale effort in Delaware early Thursday, reporting $72.6 million in debt and launching its bankruptcy with plans for a stalking-horse-led marketing of the 46-store business.

  • August 9, 2017

    Firm Brings New Antitrust Suit Over Bankruptcy Software Fees

    A suit removed to federal court on Tuesday reveals that law firm McGarry & McGarry LLC is taking another stab at antitrust conspiracy claims regarding fees charged to Chapter 7 trustees, even after the Seventh Circuit and federal courts have recently dismissed similar claims from the firm.

  • August 9, 2017

    Puerto Rico Sales Tax Bond Row On Track For Dec. Resolution

    The federal judge overseeing Puerto Rico’s landmark insolvency proceedings nudged forward a consensual plan to settle a key creditor dispute over liens on the territory’s sales tax revenues before the end of the year, approving the appointment of agents to represent competing bondholders at a hearing Wednesday.

Expert Analysis

  • Time For Bankruptcy Auctions To Go Online

    Brad Miller

    Complex auctions under the Bankruptcy Code are still often conducted in the traditional manner — live and in person in law offices and courtrooms. An online auction that is designed specifically to meet the needs of all stakeholders is a better approach, say Brad Miller and Margarita Patria of Charles River Associates.

  • Weekly Column

    Innovating For Wise Juries: Closing Argument

    Stephen Susman

    In the final article in this series on proposed innovations to the American jury trial, Stephen Susman, Richard Lorren Jolly and Dr. Roy Futterman of the NYU School of Law Civil Jury Project sum up the improvements they believe the U.S. jury system desperately needs.

  • Oil Producers Cannot Recover From Downstream Purchasers

    Edward Ripley

    The Third Circuit recently affirmed that downstream purchasers took oil purchased from a bankrupt intermediary free and clear of the oil producers’ liens. The opinion is an important reminder that courts will look to the state lien laws and Uniform Commercial Code of a midstream company’s home state to determine whether the producers are secured, say attorneys with King & Spalding LLP.

  • 5 Questions All AFAs Should Answer Clearly

    Gregory Lantier

    While no particular form is required to establish a durable alternative fee arrangement, there are terms that should, for the benefit of both client and outside attorney, be expressly set forth in the agreement itself, but are often overlooked, say attorneys with WilmerHale.

  • Fiduciary Duty Claims In Bankruptcy: Mitigating The Risks

    Joseph Swanson

    In a bankruptcy, the trustee, shareholders, employees and other third parties frequently look to hold the directors and officers responsible through breach of fiduciary duty claims. Although defending these claims can be stressful, there are protections in place for defendants and strategies that can reduce their exposure, say Joseph Swanson and Donald Kirk of Carlton Fields Jorden Burt PA.

  • Cybersecurity Risks In The Courtroom

    Daniel Garrie

    As cybercriminals continue to look for easy targets, the court system will surely enter their crosshairs. If judges and court personnel do not maintain proper data security and cyber hygiene, confidential litigant information can fall into the hands of a wide variety of bad actors, say Daniel Garrie of JAMS, David Cass of IBM Cloud, Joey Johnson of Premise Health Inc. and Richard Rushing of Motorola Mobility LLC.

  • CIMLA And The Confusion Around Maritime Liens

    Brian Maloney

    Although the Commercial Instruments and Maritime Lien Act was enacted to clarify confusion regarding the rights and remedies of participants in the shipping industry, recent global insolvencies of entities such as O.W. Bunker and Hanjin have forced courts to reconsider the text, history and purpose of a seemingly straightforward federal statute, say Brian Maloney and Laura Miller of Seward & Kissel LLP.

  • Monthly Column

    Gray Matters: Clients Are Not Really 'Emotional'

    Gray Matters

    When you look at your client through the "survival circuit" lens, what first appeared as an emotional mess is now valuable information about what is important to them, what needs have to be met to settle the case, or what further clarity your client requires before moving forward, say dispute resolution experts Selina Shultz and Robert Creo.

  • Fisker Takes Trustee Avoidance Powers Overseas

    Chad Dale

    The Delaware bankruptcy court's recent decision in the case of Fisker Automotive significantly expanded the ability of debtors in possession and trustees to pursue fraudulent transfer and unjust enrichment claims for transactions occurring outside the U.S., say attorneys with K&L Gates LLP.

  • Having A Chief Privacy Officer Reassures Your Firm's Clients

    Rita Heimes

    When a law firm appoints a chief privacy officer, not only does the firm benefit from the crucial operational impact of a well-managed privacy program, but clients see how seriously you take your duties of confidentiality and competence, says Rita Heimes, research director at the International Association of Privacy Professionals.