Waldorf – Another UK Restructuring Plan is Declined Sanction on the Basis of Fairness and Judicial Discretion

By Sabina Khan on September 11, 2025 Posted in UK

The High Court has refused to use its discretion to sanction a restructuring plan proposed by Waldorf Production UK Plc (Waldorf or the Company) which entailed a cramdown of the company’s unsecured creditors pursuant to Part 26A of the Companies Act 2006.

Background

Waldorf (and its wider group) are engaged in the exploration and production of oil and gas in the UK Continental Shelf (the “UKCS”). At a very high level, and for the purposes of the proposed restructuring plan, the Company had three classes of creditors: (i) bondholders who had lent monies under various bonds issued by the Company and who benefitted from certain security (the “Bondholders”), (ii) HMRC, an unsecured creditor owed c.US$75m (representing EPL and certain corporation tax liabilities), and (iii) a contractual counterparty (“Capricorn”) owed c.US$29m pursuant to deferred consideration arrangements under a previous sale transaction.

MVLs and Issuing Notices of Intended Dividends (UK)

By Rachael Markham on August 29, 2025 Posted in UK

HMRC has issued new guidance explaining its expectations for the proportionate and appropriate use of Notices of Intended Dividends (NOIDs) in an MVL in light of what it says are challenges created by practitioners issuing a NOID at the start of an MVL where doing so might be inappropriate.

Second Circuit Clarifies Direct vs. Derivative Claims in Bankruptcy Dispute (US)

By Norman N. Kinel on August 28, 2025 Posted in US

On March 4, 2025, the U.S. Court of Appeals for the Second Circuit issued a precedential decision in Little Hearts Marks Family II L.P. v. Carter (In re 305 East 61st Street Group LLC), 130 F.4th 272 (2d Cir. 2025), delineating the boundary between claims a member of a limited liability company may assert in their own right and those that are derivative in nature and thus may be prosecuted only by the LLC. The decision offers important guidance in particular for real estate investors, LLC members, and bankruptcy practitioners generally.

Impact on Bankruptcy Injunctions Following Supreme Court’s Trump v. CASA Decision

By Kyle Arendsen on August 14, 2025 Posted in US

On June 27, 2025, the U.S. Supreme Court issued its decision in Trump v. CASA, Inc.,[1] which materially limited the ability of federal courts to issue so-called “universal” or “nationwide” injunctions. Injunctions are common in bankruptcy cases, sometimes at the outset and nearly always as a part of a debtor’s proposed plan to reorganize or liquidate. Does the CASA decision restrict bankruptcy courts from approving a (i) preliminary injunction early in the bankruptcy case and/or (ii) plan that includes an injunction barring third parties from litigating against non-debtor parties (i.e., a third-party release)? Based on the Supreme Court’s analysis, CASA may present an opportunity for a party to present a novel argument that preliminary injunctions and/or plan releases, consensual or nonconsensual, are impermissible.

The Italian Court Confirms that the Principle of Competitiveness in Buyer Selection During Negotiated Business Crisis Settlements cannot be Dispensed with

By Enrico Calabria and Francesco Triga on August 12, 2025 Posted in EU

The negotiated settlement procedure introduced by the Italian Code of Business Crisis and Insolvency (“CCII”), is a tool designed to facilitate the recovery of financially distressed companies through consensual, out-of-court solutions.

Under Article 22(1)(d) of CCII, an entrepreneur may request the Court’s authorization to transfer its business (or one or more of its branches), in any form, to a buyer, without the buyer being liable for the company’s previous debts. The court grants authorization after verifying that the transaction supports business continuity and maximizes returns to creditors, while also ensuring that the buyer is selected through a competitive process. The principle of competition ensures that the business transfer is carried out under the most favorable conditions for creditors.

The Genius Act and the Law of Unintended Consequences: Are Stablecoin Issuers Going to Be Boxed Out of Bankruptcy? (US)

By Mark Salzberg on August 6, 2025 Posted in US

On July 18, 2025, President Trump signed into law the Guiding and Establishing National Innovation for U.S. Stablecoins Act, otherwise known as the GENIUS Act. The purpose of the GENIUS Act is to establish a comprehensive regulatory framework for stablecoins in the United States. However, the GENIUS Act also makes several important changes to the U.S. Bankruptcy Code which gives stablecoin holders significant power and leverage over bankruptcies filed by stablecoin operators but also threatens those bankruptcies with administrative insolvency.

Sberbank CZ – the biggest Czech Bank Insolvency Case

By Vladimir Polach and Ivan Chalupa on August 5, 2025 Posted in EU

Background

Sberbank CZ was an indirect subsidiary of the Russian state-owned bank Sberbank. In 2020, it was the 10^th largest Czech bank by assets and had a total of 95,000 individuals and 11,000 companies on its client list. Its rapid fall into insolvency and subsequent bankruptcy is described in more detail below.

Stays on “actions” or “proceedings” when a company is in liquidation – what does this mean for secured creditors? (UK)

By Rachael Markham on July 28, 2025 Posted in UK

In a short, but helpful judgment the court considered whether the stay imposed by s130(2) of the IA 1986 on actions or proceedings against a company in liquidation applied to a secured creditor exercising its power of sale. In confirming that it did not, the court outlined the purpose behind that provision and considered what is or might constitute an “action” or “proceeding” that would be caught under that provision.

S130(2) of the IA 1986 provides:

“When a winding-up order has been made or a provisional liquidator has been appointed, no action or proceeding shall be proceeded with or commenced against the company or its property, except by leave of the court and subject to such terms as the court may impose”

In this case (Waypark Commercial Mortgage 1 Ltd v Vanguard Number 1 Ltd (in liquidation) [2025] EWHC 1786 (Ch)) the secured creditor had a debenture that included a legal charge over a property known as Oak House. Following demand for payment the creditor exercised its power of sale, and a sale had been agreed and was progressing but before that sale had completed the company was wound up on a petition presented by another creditor. The purchasers of Oak House were concerned that s130(2) might invalidate the sale of the property to their clients, and therefore the application was brought to obtain (a) a declaration that s130(2) did not apply or (b) permission for the sale to proceed.

Update on Litigation Funding as UK Court of Appeal Considers the terms of a Litigation Funding Agreement (UK)

By Rachael Markham on July 24, 2025 Posted in UK

The ability to fund insolvency litigation can make a significant difference to realisations in an insolvent estate. Although many claims are now assigned to specialist funders (where the funder both runs and funds the claim) some insolvency practitioners have (at least until the Supreme Court decision in PACCAR came along) used litigation funding agreements (LFAs) to pursue litigation themselves, for the benefit of the estate.

Petrofac in the Court of Appeal: Key Takeaways (UK)

By Helena Clarke on July 22, 2025 Posted in UK

The Court of Appeal has handed down judgment in the Petrofac restructuring plan, overturning the sanctioning of the plans by the High Court. This is only the third time a restructuring plan has been considered by the Court of Appeal, in this blog we focus in on some of the key points of interest for future plans: