New York Southern District

Non-Consensual Third-Party Releases Pass Muster in Chapter 15

Principles of comity justify enforcing a U.K. scheme of arrangement that releases non-filed affiliates’ guarantees.

District Court Endorses Opt-Out to Confirm Substantive Consolidation Plans

Augie/Restivo problems are avoided by including opt-out provisions in a substantive consolidation chapter 11 plan.

Madoff Opinions Ease Pleading Requirements in Suits Against Subsequent Transferees

Bankruptcy Judge Vyskocil holds that alter ego need not be alleged to recover from a corporation’s sole shareholder as the beneficiary of a fraudulent transfer.

SIPA Bars General Unsecured Claims for Failure to Transfer Accounts Before Filing

The trustee for a bankrupt broker can ignore an individual customer’s request to transfer securities to a solvent broker and may instead transfer customer accounts in bulk.

Flip Clauses in Swaps Held Enforceable by District Judge in New York

For swaps, the Section 560 safe harbor overrides the anti-ipso facto provisions in the Bankruptcy Code.

The GM Creditors’ Trust Opens a Can of Worms by Nixing a Settlement

Bankruptcy judge finds bad faith for walking out on a fully documented but unsigned settlement.

The Proper Role of an Expert on Willful Blindness in a Fraudulent Transfer Suit

Madoff spawns more law, this time on expert testimony about the good faith defense to a fraudulent transfer with ‘actual intent.’

French ‘Safeguard’ Plan Held to Qualify for Enforcement in the U.S.

New York judge enforces a French reorganization similar to a U.S. prepack.

Manhattan Judge Refuses to Rubber-Stamp a Sealing Motion

Protecting negotiating leverage isn’t grounds for sealing the terms of a lease.

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