In This Issue:
Caveat Emptor—Anti-Assignment Clause Renders Transferred Claim Unenforceable
In In re Woodbridge Group of Companies, LLC, 2018 WL 3131127 (Bankr. D. Del. June 20, 2018), the bankruptcy court ruled that, because an anti-assignment clause in a promissory note was enforceable under state law, a transferred note claim asserted in bankruptcy by the purchaser of the note must be disallowed. [read more . . .]
Fifth Circuit Rules That Corporate Charter Provision Requiring Shareholder Consent for Bankruptcy Filing Is Enforceable but Declines to Rule on Validity of "Golden Shares"
In Franchise Services of North America, Inc. v. Macquarie Capital (USA), Inc. (In re Franchise Services of North America, Inc.), 891 F.3d 198 (5th Cir. 2018), the U.S. Court of Appeals for the Fifth Circuit recently affirmed a bankruptcy court order dismissing a chapter 11 case filed by a corporation without obtaining—as required by its corporate charter—the consent of a preferred shareholder that was also controlled by a creditor of the corporation. [read more . . .]
Fifth Circuit Adopts Flexible Approach to Collateral Valuation in Cramdown Chapter 11 Cases
In In re Houston Regional Sports Network, L.P., 886 F.3d 523 (5th Cir. 2018), the U.S. Court of Appeals for the Fifth Circuit held that bankruptcy courts have flexibility to select the date on which to value collateral, "so long as the bankruptcy court takes into account the purpose of the valuation and the proposed use or disposition of the collateral at issue."In so holding, the Fifth Circuit rejected the proposition that a bankruptcy court must value collateral as of either the bankruptcy petition date or the effective date of a cramdown chapter 11 plan. [read more . . .]
Oil and Gas Industry Update: Second Circuit Upholds Rejection of Sabine Gas Gathering Agreements
In Sabine Oil & Gas Corp. v. Nordheim Eagle Ford Gathering, LLC (In re Sabine Oil & Gas Corp.), 734 Fed. Appx. 64, 2018 WL 2386902 (2d Cir. May 25, 2018), the U.S. Court of Appeals for the Second Circuit in a summary order upheld a 2017 ruling by district judge Jed S. Rakoff that affirmed 2016 bankruptcy court rulings authorizing chapter 11 debtor Sabine Oil & Gas Corp. to reject certain gas gathering and handling agreements under section 365 of the Bankruptcy Code. [read more . . .]
Newsworthy:
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In 2018, for the third year in a row, the "Best...
