Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
Feeling Left Out: The Debate over Insurer Participation in Prepackaged Bankruptcy Plans
In recent years, an increasing number of companies have sought to resolve current and future liability for long-tail exposures, such as asbestos or silica, by filing prepackaged bankruptcy cases. These bankruptcy filings raise numerous insurance-related issues.
In a typical prepackaged bankruptcy case, a company facing asbestos liabilities and the law firms representing the asbestos claimants engage in extensive negotiations regarding the potential resolution of the company's liabilities, in which insurers are not permitted to participate. These negotiations ultimately result in a settlement of the company's current and future asbestos liabilities that is memorialized in a prepackaged bankruptcy plan. Prior to filing the bankruptcy case, the company seeks and obtains support for the proposed plan from its creditors. Once the requisite creditor support is attained, the company files its prepackaged bankruptcy case seeking to significantly streamline the normal Chapter 11 bankruptcy process.
Companies that have filed prepackaged bankruptcy cases in the asbestos context maintain that by filing for bankruptcy and availing themselves of channeling injunctions under Section 524(g), they are able to provide reasonable compensation to hundreds of thousands of injured individuals in an orderly and expedited claim process, while minimizing litigation and transactional costs. Prepackaged bankruptcy filings, however, can also be an attempt by policyholders to fix and accelerate their insurance recoveries at arbitrary and inflated amounts without permitting insurer participation in the negotiation of the settlement or the prepackaged bankruptcy plan. The exclusion of insurers seeking to participate in a policyholder's bankruptcy proceedings from the plan negotiation and approval process may abrogate their contractual rights. In several recent cases, insurers have attempted to participate in prepackaged bankruptcy cases to protect their interests with mixed results. Two recent bankruptcy cases demonstrate the insurance-related issues that arise when a policyholder files a prepackaged bankruptcy case: the Combustion Engineering and the Halliburton Co. Subsidiaries bankruptcy cases.
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.
The Anti-Assignment Override Provisions
UCC Sections 9406(d) and 9408(a) are one of the most powerful, yet least understood, sections of the Uniform Commercial Code. On their face, they appear to override anti-assignment provisions in agreements that would limit the grant of a security interest. But do these sections really work?