Bankruptcy & Restructuring

Could bankruptcy protection be on the horizon for individuals and companies actively involved in the cannabis industry?  Potentially yes, following President Biden’s October 6, 2022 request for the Secretary of Health and Human Services to begin the administrative process to review marijuana’s classification as a Schedule I substance under the Controlled Substance Act (“CSA”).

Voyager Digital Assets Inc., along with two of its affiliates, filed bankruptcy petitions in the Southern District of New York on July 5, 2022. While “crypto” is a newcomer to the United States bankruptcy system, the familiar contours of insolvency law will be at play in the Voyager bankruptcy with many new questions yet to be answered.

A reminder for how property owners and real estate developers can protect themselves – and their projects – from downstream distress. There are six key issues that owners should consider when contracting for their next project.

A recent decision by the United States District Court for the Southern District of New York highlights directors’ fiduciary duty to evaluate all aspects of multi-stage transactions, including those portions to be effectuated post-closing by successor directors.

In a recent decision, In re Astria Health, Case No. 19-01189-WLH11, 2021 Bankr. LEXIS 155 (Bankr. E.D. Wash. January 22, 2021), the Bankruptcy Court for the Eastern District of Washington arguably further expanded the context in which non-debtor releases may be allowed.

For bankruptcy litigators – or any business which has been frustrated to receive a demand letter after one of its customers filed bankruptcy – one particular amendment stands out in the CARES ACT bill. The Act amended Section 547 of the Bankruptcy Code to provide suppliers and landlords with an additional potential challenge to actions brought to “claw back” payments made by a debtor in the 90 days preceding bankruptcy.

The CARES Act assists debtors by amending Section 365(d)(3) of the Bankruptcy Code to allow, at the bankruptcy court’s discretion, small business debtors experiencing pandemic-related financial hardship an extra 60 days, in addition to the initial 60-day grace period, to make payments under unexpired leases of non-residential real property following the bankruptcy filing date.

The CARES Act benefits both debtors and creditors by temporarily modifying several sections of the Bankruptcy Code, which may be of particular interest to creditors.

The Automatic Stay: Supreme Court Finds that Retaining Debtors’ Property, Despite Turnover Demands, is Not a Stay Violation

On December 1, 2020, certain amendments to the Federal Rules of Bankruptcy Procedure take effect. The amendments largely modify rules governing bankruptcy appeals, but also impact Rules 2002 and 2004.