Lenders Cannot Prevent Borrowers from Filing Bankruptcy by Owning Minority Equity with Veto Power Over Borrower’s Decision to File Bankruptcy

Lenders Cannot Prevent Borrowers from Filing Bankruptcy by Owning Minority Equity with Veto Power Over Borrower’s Decision to File Bankruptcy

In a recent decision, the U.S. Bankruptcy Court for the District of Delaware refused to enforce a provision in the debtor’s LLC operating agreement requiring a unanimous vote of the debtor’s members to authorize the debtor to file for bankruptcy. 

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Your Customer Just Declared Bankruptcy: Recent Decision That All Suppliers/Vendors Should Be Aware Of

By | Manufacturing Law Blog | June 29, 2016

Suppliers and vendors sometimes find themselves unpleasantly surprised by the bankruptcy of a customer, leaving a trail of unpaid invoices and little hope of recovery. To make matters worse, after licking their wounds and recovering from the write-off, they may receive an even less welcome surprise—a letter from the bankruptcy trustee demanding money back for the bills that actually did get paid within 90 days prior to the customer’s bankruptcy. The only good news is that there are some defenses to such a claim. In a recent decision, The Unsecured Creditors Comm. of Sparrer Sausage, Inc. v. Jason Foods, Inc., No. 15-2356 (7th Cir. Jun. 10, 2016), the United States Court of Appeals for the Seventh Circuit eliminated most of the exposure faced by the supplier, who had been sued for a preference, when it concluded that lower courts had misapplied the ordinary course of business defense the supplier had raised below.

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PacSun – Judge Silverstein Grants Class Certification

PacSun – Judge Silverstein Grants Class Certification

On June 22, 2016, Judge Laurie Selber Silverstein of the Delaware Bankruptcy Court ruled on a motion to for class certification in the PacSun bankruptcy, Case No. 16-10882.  In 2011, two plaintiffs filed actions under the California Labor Code Private Attorneys General Act (“PAGA”), alleging violations of California wage and hour laws. 

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Russian Retailers Run into Trouble

Russian Retailers Run into Trouble

There has been a significant increase in insolvencies in the construction, real estate, retail and wholesale sectors of the Russian economy, according to the statistics in the Competition Development Bulletin “Concentration on the Russian Markets: Trends in the Period of Recession” published in December 2015 by the Analytical Centre of the Government of the Russian Federation.

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