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The Rights and Treatment of Non-Debtor Contract Counterparties in Bankruptcy
Bankruptcy Code ' 365 primarily concerns whether a debtor-in-possession or trustee may assume or reject executory contracts and unexpired leases (collectively, the “Contracts”) for the benefit of the estate, but the section often places the counterparties to those Contracts in the precarious position of being required to perform while running the risk that a debtor or trustee might not do so. Until a debtor decides whether to assume or reject a Contract, the terms of the Contract continue to bind the debtor and the counterparty. If the counterparty performs, it bears the risk that the debtor will reject the Contract and the debtor will be unable to pay the administrative claim owing to the counterparty for its post-petition performance. Courts generally struggle with this tension between protecting counterparties and protecting the bankruptcy estate prior to the assumption or rejection decision.
Counterparties have several available options depending on whether a pre-petition default exists under the Contract, and depending on the terms of the Contract. This article discusses how counterparties, as well as courts, react to situations where a counterparty seeks protection from the risks inherent in continued performance under a Contract with a debtor in bankruptcy.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.