Zone of Insolvency

Zone of Insolvency

Tag Archives: Supreme Court

In a 5-4 decision, SCOTUS levels the retail playing field

Posted in U.S.
Brick and mortar retail businesses have been experiencing financial distress, with retail defaults at an all time high. In 2018 alone, there have been over a dozen retailers filing for bankruptcy protection, several of which, including Toys “R” Us and The Bon-Ton Stores, have been forced to liquidate. However, while many traditional “mall tenants” and… Continue Reading

SCOTUS Determines That 546(e) Safe Harbor Does Not Protect Transfers Where Financial Institution Is A Mere Conduit

Posted in U.S.
In a decision significantly impacting the ability of a plaintiff to prosecute avoidance actions, the United States Supreme Court, in Merit Management Group, LP v. FTI Consulting, Inc., 583 U.S. ___ (2018), unanimously held that a transfer of funds, where a financial institution served as a mere conduit, does not entitle the recipient of the… Continue Reading

SCOTUS Ends Structured Dismissals that Circumvent Priority Rules

Posted in U.S.
Earlier today, in Czyzewski v. Jevic Holding Corp., the Supreme Court put an end to “structured dismissals” that allow a debtor to leave bankruptcy while circumventing the Bankruptcy Code’s creditor payment priority scheme. A Chapter 11 debtor generally has three options for exiting bankruptcy: (1) a confirmed plan of reorganization (or liquidation); (2) conversion to… Continue Reading

Narrow Means Narrow

Posted in U.S.
On May 26, 2015, the Supreme Court of the United States (SCOTUS) decided Wellness International Network, Ltd. v. Sharif—another case addressing issues raised in the wake of the Court’s “narrow” Stern v. Marshall decision. While the case clarified some of the jurisdictional issues raised by litigants post-Stern, many issues remain and each Justice seems more… Continue Reading

Third Time’s the Charm: Supreme Court May Finally Clarify Bankruptcy Courts’ Power

Posted in U.S.
On January 14, 2015, the Supreme Court of the United States heard oral argument in Wellness International Network, Limited v. Sharif, a case that gives SCOTUS the opportunity to finally clarify the constitutional limits of bankruptcy courts’ decision-making power raised by its 2011 decision in Stern v. Marshall. But as we saw with last year’s… Continue Reading

Arkison: A Supreme Dodge

Posted in U.S.
On June 9, 2014, the Supreme Court handed down a decision in Executive Benefits Insurance Agency v. Arkison—a case that was expected to answer fundamental questions about the constitutional limits of bankruptcy courts.  The case had the potential to either dramatically reshape, or strongly reaffirm existing fraudulent transfer litigation law and practice.  Instead, in a… Continue Reading

Supreme Court Appears Ready to Limit Bankruptcy Court Power in Fraudulent Transfer Actions

Posted in Bankruptcy Courts
After January 14’s oral argument in Executive Benefits Insurance Agency v. Arkison, the big question appears to be not whether the Supreme Court will scale back bankruptcy court power over fraudulent transfer actions, but how drastic the new limitations will be.  Our previous discussions of Arkison appear here and here. Background The facts of Arkison are… Continue Reading

SCOTUS Will Hear Argument on Bankruptcy Court Authority in Fraudulent Transfer Litigation on January 14, 2014

Posted in U.S.
As we discussed in a recent post on Executive Benefits Insurance Agency v. Arkison, the United States Supreme Court is preparing to address the constitutional limits on bankruptcy court authority in fraudulent transfer litigation. In granting certiorari in Arkison, the Supreme Court agreed to consider two questions: Can a bankruptcy court issue proposed findings of fact… Continue Reading

SCOTUS Takes a Second Look at Issues Raised by Stern v. Marshall

Posted in U.S.
On June 24, 2013, the Supreme Court of the United States agreed to hear an appeal that will determine the future of fraudulent transfer litigation before all United States bankruptcy courts. In Executive Benefits Insurance Agency v. Arkison, SCOTUS will determine just how much its prior decision in Stern v. Marshall limits bankruptcy court authority… Continue Reading