Below is our initial take on recent bankruptcy-related developments:
Puerto Rico To Get Bankruptcy OK With Plan Modifications | Law360
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U.S. District Judge Laura Taylor Swain said the court will approve the Island’s reorganization plan if a number of requested amendments are made.
S&K Take: Puerto Rico can see the finish line after an arduous restructuring process. Kudos to those involved in this complicated and important matter.
Brooklyn Developer Aims For Ch. 11 Transaction In 60 Days | Law360
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All Year Holdings Ltd., a Brooklyn property development firm, has six potential bidders lined up for a Chapter 11 sale to help the company emerge from bankruptcy.
S&K Take: While chapter 11 filings have been historically slow, real estate has been one of the industries that has provided some fodder for restructuring professionals. Cases have also provided an opportunity for distressed asset investors, although it looks like there may be some competition in this process.
Boy Scouts Says Abuse Claims Likely to Be Paid in Full, With Lowered Liability Estimates | Wall Street Journal
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The Boy Scouts of America said in a U.S. Bankruptcy Court that it expects to pay survivors of abuse in full from its chapter 11 reorganization plan.
S&K Take: Without taking away from what the debtors have accomplished in these cases, the headline is a little bit misleading. For claims to be paid in full, the value of those claims would have to fall within a certain range, and some of the non-monetized assets accessible by claimants would have to hold some value. “Could be paid in full at some point in the future” would be a little more accurate.
Houston Becomes a Magnet for Blockbuster U.S. Bankruptcies | Financial Times
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Houston, Texas has become a preferred destination for companies seeing Chapter 11 bankruptcy protection, as the city received a third of U.S. bankruptcy filings in 2021 in which the debtor’s liabilities were greater than $500m.
S&K Take: Advocates of venue reform need to update their hit lists to include Houston as a magnet jurisdiction that purportedly disenfranchises local interests. Wilmington and New York can’t hog all of the blame anymore.
Supreme Court to Determine Constitutionality of Bankruptcy Fee Increase | Reuters
The U.S. Supreme Court announced it will weigh in on a dispute over the recent fee increase that Chapter 11 debtors must pay the federal government.
S&K Take: While always interesting to see bankruptcy-related cases addressed by the highest court in the land, this is less about bankruptcy and more about uniformity of laws. In any case, one that we will all be keeping an eye on.
