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2019 Spring Investment Forum
April 4 & 5, 2019

Four Seasons Hotel - Chicago
120 E Delaware Pl
Chicago, IL 60611

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Lincoln Financial Group

Hancock Natural Resource Group

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ACIC Private Notes                                April 2019
Welcome to the April 2019 edition of the ACIC Private Notes!  This edition brings you recent case law summaries from:
  • the Mid-Atlantic Region, prepared by Margaret G. Parker-Yavuz (of Akin Gump);
  • the Rocky Mountain/Western Region, prepared by David Simonds and Edward McNeilly (both of Akin Gump); and
  • the Southwest Region, prepared by Andrew Thomison (of Baker Botts).
Now that it's officially spring - this means the 2019 Spring Investment Forum is just around the corner! Click here to learn more about the panels and access conference materials! We look forward to seeing you at the Four Seasons Hotel on April 4 and 5 in Chicago.
Recent Case Law Summaries
Mid-Atlantic Region
In In re Lehman Brothers Holdings Inc., the Bankruptcy Court for the Southern District of New York denied a motion to permit a plan administrator to cause a debtor to issue preferred stock under the terms of its pre-effective date charter in substitution for Enhanced Capital Advantaged Preferred Securities (ECAPS) issued by affiliates of the debtor, as if such preferred stock were being issued prior to the petition date. Click here to learn more.
In In re Taberna Preferred Funding IV, Ltd., the Bankruptcy Court for the Southern District of New York granted a motion to dismiss in an involuntary chapter 11 petition, holding that the petitioning creditors failed to make a prima facie case that they were eligible under section 303(b) of the Bankruptcy Code to file an involuntary petition against the debtor because the notes they held were nonrecourse and, accordingly, their claims were against the collateral securing the notes and not against the debtor itself. Click here to learn more.
In In re Orexigen Therapeutics, Inc., the Bankruptcy Court for the District of Delaware denied a motion by an alleged creditor seeking a determination that it was entitled to disputed funds based on its right of setoff under state law. Click here to learn more.
Rocky Mountain/Western Region
In In re Pettit Oil Co., the Bankruptcy Court entered (and the Court of Appeals for the Ninth Circuit affirmed) a summary judgment in favor of a trustee exercising her "strong-arm" powers as a hypothetical judicial lien creditor, holding that the trustee had priority over a petroleum company that delivered fuel to a debtor on a consignment basis. Click here to learn more.
In Cohen v. TNP 2008 Participating Notes Program, LLC, the California Fifth District Court of Appeal held, among other things, that an attorney for holders of promissory notes issued by a real estate investment company lacked standing, as agent of his clients/investors, to enforce arbitration agreements in the subscription agreements relating to such promissory notes, but that the parent of such investment company was bound to the arbitration provision because such parent exercised sufficient control over such investment company. Click here to learn more.
Southwest Region
In Legacy Bank v. Fab Tech Drilling Equipment, Inc, in an issue of first impression, the Court of Appeals of Texas held that garnishment of a debtor's accounts receivable by a junior judgment lien creditor would not trump a secured creditor's first-priority lien against the same assets. Click here to learn more.
In In re: Ultra Petroleum Corp., the Fifth Circuit Court of Appeals held that certain unsecured creditors of Ultra Resources, Inc. were not impaired for purposes of voting on a reorganization plan even though the plan did not provide for payment of the make-whole premium required by the terms of the underlying contracts and provided post-petition interest at the federal judgment rate instead of the default rate. Click here to learn more.