Increasingly, U.S. bondholders and other creditors of foreign debtors have turned to U.S. courts in chapter 15 cases in an attempt to improve their position against a foreign debtor or other stakeholders. However, chapter 15 filings themselves are not within the direct control of U.S. bondholders, and chapter 15 contains limitations that may restrict its usefulness to U.S. bondholders that are seeking to protect or enhance their rights. In some cases, a chapter 15 case that looks like an open door for bondholders to challenge foreign insolvency proceedings turns out to be a picture window through which they can only watch the results of a foreign insolvency unfold. How can U.S. bondholders best employ the potential leverage that chapter 15 may afford them in cross-border insolvency disputes?
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Originally published by: ABI Journal, Vol. XXXIII, No. 8, August 2014.
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