Category Archives: Analysis

On January 7, 2013, the Judge Robert D. Drain of the United States Bankruptcy Court for the Southern District of New York held that a dispute concerning the debtors’ use of cash collateral was not subject to arbitration, notwithstanding a broad arbitration clause in the parties’ underlying agreement, because the decision to allow a debtor to use cash collateral constituted a “core” issue and was a fundamental aspect of the bankruptcy process. In re Hostess Brands, Inc., No. 12-22052 (RDD), 2013 WL 82914 (Bankr. S.D.N.Y. Jan. 7, 2013). Continue reading →

To our readers:

From the Supreme Court weighing in on a chapter 11 case to Bankruptcy Court opinions that may profoundly impact venue selection, many important bankruptcy developments occurred in Restructuring Review’s inaugural year. Below is Part II in our first annual year-end list of the most significant decisions and developments in 2012. This list is presented chronologically. We’d love to hear your feedback as to what you think are the most important events of the year.

We appreciate you visiting Restructuring Review this year and look forward to providing you with frequent insight and analysis in 2013.

Best wishes for a happy and healthy holiday season.

Continue reading →

To our readers:

From the Supreme Court weighing in on a chapter 11 case to Bankruptcy Court opinions that may profoundly impact venue selection, many important bankruptcy developments occurred in Restructuring Review’s inaugural year. Below is Part I in our first annual year-end list of the most significant decisions and developments in 2012. Part II will be posted shortly. This list is presented chronologically. We’d love to hear your feedback as to what you think are the most important events of the year.

We appreciate you visiting Restructuring Review this year and look forward to providing you with frequent insight and analysis in 2013.

Best wishes for a happy and healthy holiday season. Continue reading →

On November 27, 2012, in a ruling that undoubtedly will impact the choice of venue for many large corporate bankruptcies in the future, Judge Shelley C. Chapman of the United States Bankruptcy Court for the Southern District of New York transferred venue of the chapter 11 cases of Patriot Coal Corporation and ninety-eight of its affiliates to the Eastern District of Missouri. Drawing on an array of jurisprudence regarding venue, Judge Chapman found that notwithstanding literal compliance with the applicable statute, the New York domicile of two of the debtors was insufficient to establish venue for all ninety-nine cases in the Southern District of New York when the two debtors were formed on the eve of the commencement of the chapter 11 cases admittedly for the sole purpose of establishing venue. In re Patriot Coal Corp., 12-12900-SCC (Bankr. S.D.N.Y. Nov. 27, 2012) [docket no. 1629]. The Patriot decision is the latest in a line of recent decisions by courts in the Southern District of New York and the District of Delaware granting motions to transfer venue to other districts. The decision is notable in that it strongly discourages the practice of “bootstrapping” a corporate bankruptcy case to the case of a recently formed affiliate in New York when the debtor has no meaningful presence in the jurisdiction, change of venue is requested by economic parties in interest, and moving the case is unlikely to inflict demonstrable economic harm to the estate. Continue reading →

On 26 October 2012, the United States Court of Appeals for the Second Circuit upheld permanent injunctions designed to remedy Argentina’s breach of a promise to pay certain bondholders after a 2001 default on its sovereign debt. Relying on an “equal treatment” clause which provided that payment of the bonds ranked at least equally with Argentina’s other present and future bond issuances, the court held that Argentina could not discriminate against the defaulted bonds in favor of bonds issued in its 2005 and 2010 sovereign debt restructurings. Accordingly, the court enjoined Argentina from making payments on the 2005 and 2010 bonds without making comparable payments on the defaulted bonds. Continue reading →

Cadwalader partner Richard Nevins recently sat down to discuss developments in European restructurings with Doug Mintz, Restructuring Review’s Co-Editor-in-Chief and Cadwalader Special Counsel. Continue reading →

After a final mediation session between Hostess and its unions failed to put Hostess’s reorganization back on track, Bankruptcy Judge Robert Drain authorized the orderly wind down of Hostess’s operations. As a result, Hostess will prepare to sell its assets and shut down its factories. However, a purchaser may seek to restart the production of the beloved baked goods such as Twinkies, Ho-Hos and Donettes. Continue reading →

Reports of Twinkie the Kid’s death have been exaggerated. Despite widespread mainstream media reports of Hostess’ impending liquidation, the court has not yet approved liquidation. To the contrary, on November 19, 2012, after a brief hearing on Hostess’s emergency motions to begin the wind down of its operations, Hostess and its two main unions agreed to attend a confidential mediation session. At the mediation, Bankruptcy Judge Robert Drain intends to determine if the parties can avoid liquidation. Continue reading →