United States: Courts, Cooperation, And More: Incorporating Case-Specific Provisions In Insolvency Protocols

Last Updated: September 6 2017
Article by Kevyn D. Orr, Dan T. Moss and Anna M. Wetzel

Most Read Contributor in United States, September 2019

In Short

The Situation: In cross-border restructuring cases, court-approved insolvency protocols are applied to facilitate communication between U.S. and foreign courts and standardize certain common procedures. The protocols are sometimes adapted to address case-specific issues.

The Result: Case-specific provisions tend to address information-sharing guidelines, claims reconciliation, the management of assets, and dispute resolution.

Looking Ahead: As cross-border restructurings become more common, protocols will likely become more prominent in case management.

In cross-border restructuring cases, interested parties increasingly rely on court-approved insolvency protocols to aid in managing complex insolvencies involving debtors' assets, liabilities, or operations that span international borders. These protocols facilitate communication between U.S. and foreign courts and standardize certain common procedures, while simultaneously protecting each nation's sovereignty.

A recent survey of protocols implemented since 2000 indicates that while protocols typically contain similar procedural and administrative provisions, the protocols are sometimes adapted to address case-specific issues. For more information on common provisions in protocols, see " Courts, Cooperation, and More: A Review of Cross-Border Insolvency Protocols." Parties involved in cross-border restructurings should consider whether they would benefit from a protocol that includes such case-specific provisions. Based on our survey, unique provisions address, among other things, the following:

Information Sharing Guidelines

In Securities Investor Protection Corp. v. Bernard L. Madoff Investment Securities LLC, Adv. Pro. No. 08-1789 (BRL) (Bankr. S.D.N.Y. May 29, 2009) (Dkt. No. 232), the joint provisional liquidators and the liquidating trustee relied on a protocol to govern the exchange of confidential information between and among each other and the various debtor entities. Specifically, the protocol listed types of information that could be freely shared between the parties, including, among other things, bank statements, accounting records, and customer statements. The protocol also imposed restrictions on sharing confidential information with third parties.

Similarly, in In re Soundview Elite Ltd., No. 13-13098 (REG) (Bankr. S.D.N.Y. Dec. 30, 2014) (Dkt. No. 502), the joint liquidators in the Cayman Islands proceeding and the chapter 11 trustee agreed to detailed guidelines to facilitate the exchange of information. The protocol sets forth each representative's respective responsibilities for obtaining, maintaining, and sharing relevant information.

Claims Reconciliation

Protocols can establish which proceeding's representative has authority to pursue or settle certain claims. For example, in In re Lancelot Investors Fund, L.P., No. 08-28225 (JPC) (Bankr. N.D. Ill. Sept. 1, 2009) (Dkt. No. 274), the court-approved protocol gave the chapter 11 trustee authority to prosecute claims and causes of action on behalf of the debtors even though both the trustee and the joint liquidators had asserted responsibility over all the debtors' assets. The protocol also established that neither the trustee nor the joint liquidators would "expend material resources on claims reconciliation" until they had agreed there were funds to do so. Finally, the parties agreed that the U.S. trustee had authority over determining the validity of secured claims and certain liens.

In other cases, parties use generic provisions to govern the identification and resolution of intercompany claims. In the Madoff case, the protocol included the following language:

The Representatives shall cooperate and negotiate in good faith regarding any potential claims by either Debtor against the other Debtor. At the appropriate stage, the Representatives shall consider whether it is sensible to implement, subject to the approval of the Tribunals, a mechanism for the resolution of intercompany claims.

Management of Assets

Some protocols include detailed provisions concerning asset identification and administration. In In re Manhattan Investment Fund Ltd., No. 00-10922 (BRL) (Bankr. S.D.N.Y. May 16, 2000) (Dkt. No. 65), the joint liquidators in the British Virgin Islands and the chapter 11 trustee relied on an insolvency protocol to establish their respective responsibilities for asset management. The protocol obligated the parties to create a work plan for asset identification, collection, and management and to discuss any relevant actions that had taken place with respect to the debtors' assets in biweekly telephone calls.

Recent cases have also included similar provisions. In Madoff, the protocol required representatives to "coordinate and cooperate expeditiously with each other regarding the identification, preservation and realization" of assets if another representative had a material interest in that asset.

Dispute Resolution

Most protocols contain guidelines on dispute resolution. Typically, the protocol instructs the parties to petition one (or all) of the courts involved to resolve disputes. However, some parties have chosen instead to include detailed alternative dispute resolution procedures in their protocols. In Manhattan Investments, for example, the protocol set forth default dispute resolution procedures that would automatically begin upon notice to the offending party unless that party opted out of the procedures. In the event the opt-out was not exercised, mediation would proceed according to the timing and procedures established in the protocol.


As cross-border restructuring matters become more prevalent, protocols will likely play a more significant role in the management of cases, particularly those with complex operations and financial structures that touch multiple jurisdictions.

Two Key Takeaways

  1. Case-specific information-sharing protocols tend to identify the types of information that can be shared between parties, and they impose restrictions on sharing confidential information with third parties.
  2. Protocols usually include guidelines pertaining to dispute resolution, but some parties have chosen instead to opt for detailed alternative dispute resolution procedures.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions