09/24/2014 - Weathering the Storm: Momentive Performance Court Rejects Market-Based Cramdown Interest Rate, Casts Doubt on Make-Whole Claims
On August 26, 2014, Judge Robert D. Drain of the Bankruptcy Court for the Southern District of New York issued a bench ruling in In re MPM Silicones, LLC
, Case No. 14-22503 (RDD), on several aspects of the plan of reorganization filed by debtor Momentive Performance Materials, Inc., a specialty chemicals manufacturing company, and its affiliated debtors.
07/17/2013 - Seventh Circuit Extends New Value Plan Protections to Insider Context
The absolute priority rule ordinarily prevents a Chapter 11 debtor from distributing any money or property to junior creditors and old equity investors unless all senior creditors have first been paid in full. See 11 U.S.C. § 1129(b)(2)(B)(ii).
04/11/2013 - Weathering the Storm: Seventh Circuit Expands Application of Federal Standard for Successor Liability to FLSA
On March 26, 2013, in the case of Teed v. Thomas & Betts Power Solutions, L.L.C
., the Seventh Circuit, in an opinion written by Judge Posner, joined at least one other circuit court and a multitude of district courts across the country in extending the federal common law standard for evaluating successor liability to suits brought under the Federal Labor Standards Act (“FLSA”).
03/07/2013 - Weathering the Storm: Fifth Circuit Permits Artificial Impairment of Unsecured Trade Creditors to Cram Down Plan Acceptance on Secured Lender
Bankruptcy Code § 1129(a)(10) provides that in order for a plan proponent to “cram down” - i.e., force acceptance of - a plan of reorganization on a dissenting class of creditors, at least one impaired class of creditors must vote in favor of the plan.
08/14/2012 - Weathering the Storm: They Said What They Meant: 5th Circuit Declines Invitation to Add Requirements to Safe Harbor for Forward Contracts
The Bankruptcy Code provides a number of “safe harbors” for forward contracts and other derivatives. These provisions exempt derivatives from a number of Bankruptcy Code provisions, including portions of the automatic stay, restrictions on terminating executory contracts, and the method for calculating rejection damages.
06/20/2012 - Think Real Estate, June 2012
Welcome to Think Real Estate
, the real estate newsletter of Haynes and Boone, LLP, a resource for timely legal analysis of issues affecting the real estate industry.
06/12/2012 - The Fallout From Cherryland - Will The Non-Recourse Carve-Out Guaranty Ever Be The Same Again?
The issue is whether the insolvency of a borrower under a non-recourse loan can trigger recourse liability for itself and its “bad boy,” non-recourse carve-out guarantors.
05/31/2012 - Supreme Court in RadLAX Rules that Cramdown Plans Providing for Sales of Secured Creditors’ Collateral Must Allow for Credit Bid Rights
In what it described as "an easy decision," the U.S. Supreme Court issued its eagerly anticipated decision in RadLAX Gateway Hotel, LLC et al. v. Amalgamated Bank
on May 29, 2012. The high court's 8-0 ruling, delivered by Justice Scalia, held that a Chapter 11 bankruptcy cramdown plan providing for the sale of a secured creditor’s collateral free and clear of the secured creditor's lien may not use Bankruptcy Code § 1129(b)(2)(A)(iii) to deny the secured creditor the right to "credit bid" on its own collateral.
12/01/2009 - In re General Growth Properties, Inc.: Motions to Dismiss SPE Cases....Denied
In the recent heyday of real estate and structured finance, the use of “bankruptcy-remote” special purpose entities (“SPEs”) as borrowers was a fundamental underwriting requirement by lenders, and a critical factor considered by ratings agencies, to shield lenders and their collateral from the potentially adverse impact of bankruptcy filings by their borrowers’ parents and affiliates.
10/21/2009 - Weathering the Storm: Savings Clauses: Fraudulent Transfer Issues in the TOUSA Bankruptcy Case
The judge's ruling in the October 13, 2009 TOUSA, Inc. bankruptcy cases raises a number of troubling issues for commercial lenders, including but not limited to, the judge calling into question the enforceability of fraudulent conveyance “savings clauses,” common in commercial loan agreements.
08/25/2009 - Weathering the Storm: Recent Court Decision Exposes the Reach of a Corporate Family’s Financial Distress to its Bankruptcy-Remote Special Purpose Entities and Their Lenders
In the recent heyday of real estate and structured finance, the use of “bankruptcy-remote” special purpose entities (SPEs) as borrowers was a fundamental underwriting requirement by lenders in many loans, and a critical factor considered by ratings agencies, to shield lenders and their collateral from the potentially adverse impact of bankruptcy filings by their borrowers’ parents and siblings.