Executory Contracts/Leases

Second Circuit Holds that Flip Clauses in Swaps Are Enforceable

Even if flip clauses are ipso facto clauses, the Second Circuit holds that enforcement is permitted by the safe harbor in Section 560.

Two Circuits Agree: Coal Act Doesn’t Bar Terminating Retiree Benefits via Section 1114

Fifth Circuit declines to create a circuit split on the ability of a coal producer to sell assets and protect the buyer from liability for retiree health benefits under the Coal Act.

Ninth Circuit Says Assumption Under Section 365(p) Doesn’t Also Require Reaffirmation

Lease assumption is binding even if the debtor doesn’t follow the procedural requirements of Section 365(p).

Sixth Circuit Broadly Interprets Section 959(b) to Cover State Pension Plans

A split panel on the Sixth Circuit held that Section 959(b) barred the debtor from halting participation in a state employees’ pension plan.

Second Circuit Broadly Caps Wage Claims Accelerated Before Bankruptcy

Second Circuit prevents ‘artful drafting’ from evading the cap on golden parachutes under Section 502(b)(7).