Restructuring News – October 2013

Third Circuit Reaffirms That Section 1123(a) of the Bankruptcy Code Preempts Insurance Policies' Anti-Assignment Provisions

Over the last two decades, many companies faced with excessive asbestos-related liabilities have successfully emerged from bankruptcy with the help of section 524(g) of the Bankruptcy Code, which channels all asbestos-related liabilities of the reorganized company to a newly formed personal injury trust.

Recent Bankruptcy Developments Impacting the Landlord-Tenent Relationship

In drafting the provisions of the Bankruptcy Code relating to nonresidential real property, Congress intended commercial landlords to be “entitled to significant safeguards.”

Staying on the Sidelines – Fifth Circuit Ruling Protects Secured Creditors Who Opt Not to Participate in Bankruptcy Proceedings

Can a secured decide not to participate in a bankruptcy proceeding and thereby avoid any impact the bankruptcy may have on its lien?

A Safe Harbor for Trustees and Bondholders: Using Section 546(e) to Protect Trustees and Bondholders from Avoidance Actions

Section 546(e) of the Bankruptcy Code offers a strong defense for holders of bonds, notes and other securities to preference and fraudulent transfer actions brought in bankruptcy proceedings.

Chapter 9: An Rx for Health Care Districts and Public Hospital Authorities?

Four (4) recent chapter 9 cases by a public health care district in the Northern District of California and by local hospital authorities in Kentucky, Oklahoma and Texas—raise the issue whether chapter 9 may increasingly be seen as a means for public hospitals facing financial distress to restructure (or adjust) their debts.

Private Equity Funds Beware: "Investment Plus" Can Result in Fund Responsibility for Portfolio Companies' Pension Withdrawal Liabilities

Today, who is and will be responsible for funding pension liabilities is a primary consideration in both private and public sector restructurings.