Worldwide: Insolvency/Bankruptcy

Cannabis companies had long been shut out of the U.S. bankruptcy system because federal courts refused to administer assets derived from or connected to federally prohibited activity.

A federal bankruptcy court in Delaware has made a groundbreaking decision by recognizing a foreign insolvency proceeding for a cannabis company, marking the first time a U.S. federal court has acknowledged such proceedings despite marijuana's continued federal prohibition. This development opens new restructuring pathways for distressed cannabis operators who were previously limited to state-law remedies like receiverships and out-of-court restructuring.

New York LLCs without operating agreements are as common as noodles in Naples. Most function just fine without one. Their members just rely upon the statutory default rules found in the New York Limited Liability...

Not every business partnership ends with someone buying the others out. Sometimes the relationship deteriorates to the point where no one wants to stay, no one wants to sell, and the only thing the partners can agree...

A Texas bankruptcy court has adopted the Barnet rule requiring foreign debtors to have U.S. assets to be eligible for Chapter 15 relief, expanding this approach beyond the Second Circuit.

A Delaware bankruptcy court has ruled that trustees can pursue fraudulent transfer recovery from subsequent transferees without naming the initial transferee as a defendant, though they must still prove the initial transfer was avoidable. This decision resolves a circuit split by adopting the majority view that treats avoidance as an element of liability rather than a prerequisite action, potentially streamlining bankruptcy litigation and estate recovery efforts.

When the title to real property is transferred for the express purpose of placing it out of reach of a known creditor, the transfer is a fraudulent conveyance.

Private equity sponsors and lenders are navigating an environment in which disciplined deal structuring and downside preparedness are increasingly interconnected.

Nine Energy Service's recent 32-day bankruptcy restructuring highlights a critical vulnerability facing oilfield services companies in today's volatile market: the risk of customer insolvency wiping out receivables.