The Future Of Small Business Bankruptcies And Creditors’ Committees After The SBRA: In Re Bonert And In Re Lear Capital

With the passage of the Small Business Reorganization Act (the “SBRA”) in 2019,1 Congress made significant changes to the Bankruptcy Code2 that affect small businesses.3 These changes include removing the appointment of a creditors’ committee as a matter of course for small businesses and the creation of subchapter V,4 a new, additional, and streamlined bankruptcy option for eligible small businesses.5 Two recent cases, In re Bonert6 and In re Lear Capital, Inc.,7 offer an opportunity to examine these changes and may offer insight […]

By | August 13th, 2022 ||

TPC Bankruptcy And District Court Opinions Uphold Uptiering Transaction And Teach An Important Lesson On The Need For Express Lender Protections In Debt Documents

A recent U.S. District Court for the District of Delaware opinion, In re TPC Grp. Inc., provided another instance of an uptiering transaction withstanding legal scrutiny and provides further support for the view that courts generally avoid “reading-in” language not expressly stated in debt documents, especially when such documents were negotiated at arms-length by sophisticated parties. As a result of the court’s guidance, lenders may be more willing to participate in uptiering transactions or other […]

By | August 4th, 2022 ||

Liquidating Chapter 11 Debtor Excused From Providing WARN Act Notification Of Employee Layoffs Due To Pandemic Natural Disaster

Large employers intending to lay off a significant number of their employees are required by the Worker Adjustment and Retraining Notification Act of 1988 (the “WARN Act”) to give the targeted employees 60 days’ advance notice of the layoffs. However, there are certain exceptions to the notice requirement in cases where the employer is a “faltering business” or a “liquidating fiduciary,” or where “unforeseeable business circumstances” or a “natural disaster” make it impracticable or […]

By | July 29th, 2022 ||