Business Restructuring Review
In this issue:
- Eighth Circuit Reaffirms Legitimacy of Derivative Standing
The court of appeals ruled that derivative standing may be appropriate if a trustee or DIPconsents to, or does not oppose, the prosecution of estate claims by a creditor or committee, and the doctrine is not limited to situations involving a trustee’s inability or unwillingness to prosecute such claims. - Newsworthy
- Australia Adopts the Model Law on Cross-Border Insolvency
Australia recently became the 15th nation or territory to enact some form of the Model Law on Cross-Border Insolvency, a framework of principles designed to coordinate cross-border bankruptcy and insolvency cases. - Recent Delaware Ruling a Cautionary Tale for Fiduciaries Stewarding Brink-of-Insolvency Corporations
The strictures of the fiduciary duty of loyalty of officers and directors in a distressed scenario were the subject of a ruling recently handed down by a Delaware bankruptcy court. - Lender Entitled to Grid as Well as Default Interest as Part of Allowed Secured Claim Where Debtor Provided Inaccurate Financial Information
ANew York district court reversed a bankruptcy court order excluding from the allowed amount of a secured claim "grid" interest to which the lenders would have been entitled had the debtors provided them with accurate financial information. - Amendments Proposed to Rules of Bankruptcy Procedure
- Reclamation Rights Not Extinguished When Goods Are Sold to Satisfy DIP Lender’s Claims
Even though section 546(c) of the Bankruptcy Code was amended in 2005 to clarify that reclamation rights are subordinate to the rights of any creditor asserting a security interest in the goods, a number of unsettled issues endure concerning the impact of a bankruptcy filing on reclamation rights.
