A Florida federal bankruptcy judge has converted the Chapter 11 case of an attorney who was acquitted last year in a billion-dollar medical fraud scheme to Chapter 7 proceedings. The decision came on the grounds that the debtor is currently unemployed and lacks the financial means to repay his creditors. The attorney had initially sought…
The recent US Supreme Court ruling in Harrington v. Purdue Pharma has invalidated nonconsensual third-party releases in Chapter 11 cases, a ruling that will profoundly influence large-scale restructurings. These releases have been a common fixture in mass tort bankruptcies and large corporate reorganizations, wherein entities connected to the debtor gain immunity from creditor claims. The…
Rudy Giuliani, former New York City mayor and lawyer for Donald Trump, faces a significant downfall as he transitions out of the practice of law in the wake of legal and financial troubles. Recently, the New York Appellate Division converted Giuliani’s suspension from law practice into full disbarment, citing that he made “demonstrably false and…
In a tight 5-4 decision, the US Supreme Court on Thursday nullified a multibillion-dollar opioid settlement involving Purdue Pharma, makers of OxyContin, due to its provision granting the Sackler family lifetime immunity from future opioid-related litigation. The Court’s decision mandates that settlement negotiations begin anew, potentially delaying compensation for over 100,000 people affected by the…
As the mechanics of Chapter 11 bankruptcy proceedings become more public, the practice of bankruptcy venue shopping has attracted increasing scrutiny and concern. While forum shopping might offer strategic advantages for corporations, such as predictable outcomes or perceived efficiencies, it runs counter to the principles of procedural justice, eroding public faith in the system. Robert…
A three-judge panel of the U.S. Court of Appeals for the Second Circuit has affirmed a Manhattan district judge’s ruling in favor of Charter Communications in a lawsuit involving advertising produced by Charter following the bankruptcy filing of its competitor, Windstream Holdings. Chief Circuit Judge Debra Ann Livingston, along with Circuit Judges José Cabranes and…
A recent decision from Chief Judge Glenn of the Southern District of New York Bankruptcy Court offers valuable insights for creditors and debtors engaged in settlement negotiations that include agreements requiring creditor support for the debtor’s Chapter 11 plan. In In re GOL Linhas Aéreas Inteligentes S.A., Chief Judge Glenn evaluated the enforceability of a…
The recent collapse of Synapse Financial Technologies Inc., a fintech middleman backed by Andreessen Horowitz, has highlighted significant risks associated with the “banking as a service” model. The San Francisco-based company, which filed for Chapter 11 bankruptcy protection in April, has left customers like Joseph Dominguez and his wife unable to access more than $20,000…
In a decision that addresses a technical question under the Bankruptcy Code, the U.S. Supreme Court ruled in Truck Insurance Exchange v. Kaiser Gypsum Co. that insurance companies must be recognized as “parties in interest” in certain Chapter 11 bankruptcy proceedings. The judgment clarifies when an entity has the statutory right to be heard on…
Vinson & Elkins LLP has been disqualified from representing wood-pellet manufacturer Enviva Inc. in its bankruptcy proceedings. The ruling, handed down by Judge Brian F. Kenney of the US Bankruptcy Court for the Eastern District of Virginia, cited a conflict of interest. The firm’s concurrent representation of Riverstone Investment Group LLC, Enviva’s largest equity holder,…
New Jersey federal courts have recently experienced a substantial increase in the number of Chapter 11 bankruptcy filings. The state now ranks second in the nation for the number of these cases, according to statements made on Friday by Chief U.S. District Judge Renée Marie Bumb of the District of New Jersey. The influx of…
Commercial landlords, already impacted by a slump in the real estate market, are set for additional burdens as retailers face continuous difficulties due to persistently high inflation and interest rates. These economic headwinds have steered various businesses towards bankruptcy, such as rue21, which filed for Chapter 11 bankruptcy on May 2, 2024. In April 2024,…
In an ironic twist of events, a prominent bankruptcy law firm, LifeBack Law Firm, in Minnesota has recently filed for Chapter 11 bankruptcy protection, following the loss of a legal dispute with a competitor. The firm’s decision to seek restructuring procedures underscores the critical impacts of such disputes, even for firms operating within the realm…
In a recent development, Labcorp, a leading laboratory testing entity, has been chosen as the winning bidder for Invitae’s assets through a bankruptcy auction. Invitae, a firm specializing in genetic testing services, digital health solutions, and health data services, is set to provide Labcorp with assets covering “substantially all” of Invitae’s operations. The deal aims…
There are some major shifts taking place in regulations surrounding Chapter 11 bankruptcies, changes that could significantly benefit claimants in sex abuse cases. Most notably, the Boy Scouts of America, which filed for Chapter 11 bankruptcy protection in the District of Delaware in February 2020, had a reorganization plan confirmed after facing an unprecedented volume…
Kirkland & Ellis LLP, a renowned law firm, has recently defended its representation of Invitae Corp during recent bankruptcy litigation, arguing against objections asserting the existence of a conflict of interest. Issues were raised by the United States Department of Justice (DOJ) and some junior creditors of Invitae. These objection parties expressed their belief that…
In a notable development in the corporate sector, fashion retailer Express has filed for Chapter 11 bankruptcy. The company has attributed this move to months of diminishing demand, necessitating a reevaluation of its business operations. Express, which has been a fixture in malls across America for decades, is slated to shut down roughly 100 of…
A U.S District Court Judge has denied former New York mayor, Rudolph Giuliani’s efforts to overturn a $148 million judgment levied against him for defamation charges against two Georgia poll workers he accused of rigging the 2020 Presidential Election. The substantial judgment sought by Giuliani to be invalidated is one of the largest in a…
Lowenstein Sandler has recently expanded its bankruptcy and restructuring department with the addition of a new partner, Daniel B. Besikof. Based in New York, he brings with him a diversified set of experience and expertise, pertaining but not limited to, Chapter 11 bankruptcy proceedings, corporate restructurings, and liquidations. His new role will further enable him…
Judges in the Charlotte, North Carolina bankruptcy court have recently come to spotlight for their impactful decisions concerning the so-called ‘Two-Step’ bankruptcy procedure, a topic of controversy in corporate legal circles. This strategy, named as the ‘Texas Two-Step’, has generated a lot of discussion, matched by differing interpretations among legal professionals. The “Two-Step” legal strategy…
In an ongoing legal development, Jackson Walker LLP has filed a motion to dismiss a lawsuit accusing the law firm of concealment – more specifically of not disclosing an alleged romantic relationship between one of its former attorneys and a bankruptcy judge. The accusation was leveled by Michael Van Deelen, a shareholder in McDermott International…
Terraform Labs has been granted permission to hire Dentons US LLP as its special counsel in its ongoing Chapter 11 bankruptcy case, as ruled by a Delaware federal bankruptcy judge. The judge’s decision came alongside an agreement on the part of Dentons to return $48 million of a $70 million retainer. The retainer agreement had…
Renowned attorney Doug Mannal has broadened his professional journey by joining Morrison Foerster’s New York office as a partner. Mannal, who has been ascribed to the Business Restructuring and Insolvency group of the Transactions department, is an acknowledged expert in representing creditors both in and out of court. Bloomberg Law reported the news first on…
In February, there was a conspicuous increase in commercial Chapter 11 bankruptcy filings. As reported by Epiq Bankruptcy and the American Bankruptcy Institute, there were 822 such cases, a sizeable 118% rise compared to the 377 filings from the same month in 2023 and a 77% surge from January 2024’s 464 cases. The significant boost…
Lawyers from two of the most prestigious law firms in the country, Weil Gotshal and Kirkland & Ellis, were very busy in February, involved in a surge of bankruptcy filings. According to a report from Epiq Bankruptcy and the American Bankruptcy Institute, commercial Chapter 11 bankruptcy filings rose by 118% in February 2024 over February…