On January 29, 2019, investor-owned Pacific Gas & Electric Company (“PG&E”) declared bankruptcy, filing a Chapter 11 reorganization petition in the United States Bankruptcy Court for the Northern District of California.1 This is PG&E’s second bankruptcy petition in as many decades, as the utility also filed for Chapter 11 bankruptcy in 2001.2 For proponents of…
Tag: Bankruptcy
Mission Product Holdings v. Tempnology leaves a mark for trademark licenses rejected in bankruptcy
For decades, trademark licensees were left in the limbo when their licensors filed for bankruptcy. If a debtor-licensor exercises its statutory right to reject a licensing agreement, a luxury brand product could potentially turn into a trademark-infringing knockoff overnight.1 This issue is at the center of a circuit split regarding the question of whether a…
Bankruptcy’s Automatic Stay: The Fine Line Between Passive Action and Inaction
Cases in the Seventh and Tenth Circuits are primed for Supreme Court review of the most recent circuit clash between debtors and creditors. Florence + The Machine sums up the classic conflict between debtors and creditors well: “And every demon wants his pound of flesh But I like to keep some things to myself” –…
Insurance! What Is It Good For? Misplaced Liability for California’s Wildfires
It is no secret that California has consistently suffered some of the worst wildfires in United States history.1 Blazes in 2017 caused more than $10 billion in damages, the most in the state’s history.2 The fires, which exist everywhere from Santa Barbara and Malibu to Napa and, most recently, the City of Paradise, destroy houses,…
Toys R Us: Comeback Kid, or Kid Who Shouldn’t Have Come Back?
When Toys R Us announced the decision to close all North American stores in March 2018, the effects were cross-generational. From the young who lost a space “where a kid can be a kid,” to the old for whom the event triggered a sense of nostalgia, the Toys R Us closing had an acute impact…
Another Bankruptcy: Sears-ly
What is the store you go to for everything – your “everything store”?1 It used to be Sears. Sears Holdings Corporation’s Chapter 11 bankruptcy filing has reignited the question of how to keep a company afloat in the modern world of retailing.2 After seven straight years of losses, hedge-fund manager and former Sears CEO Edward…
PEM Entities v. Levin, Does a Circuit Split Really Matter? – Analyzing Competing Approaches to Debt-to-Equity Recharacterizations in Chapter 11.
Corporate reorganizations through bankruptcy can be a messy business. When the parties who have loaned money in an attempt to rescue a company have multiple interconnected relationships, it can become even messier and the job faced by bankruptcy courts can be daunting. That is why PEM Entities v. Levin, which was granted certiorari in 2017 only…
PROMESA and Puerto Rico’s Fiduciary Duties
On May 3, 2017, the Commonwealth of Puerto Rico declared bankruptcy under the Puerto Rico Oversight, Management, and Economic Stability Act (“PROMESA”).1 Puerto Rico is now in the unique position of being the first U.S. territory to ever declare bankruptcy. Local governments have been bankrupt before with Detroit being a notable recent example.2 In fact,…
Bankruptcy Exemptions Law Considerations
Bankruptcy Exemptions Law Note: This post is an outline of a few topics and is not intended to be exhaustive or a substitute for research or legal advice regarding bankruptcy. A basic understanding of bankruptcy exemptions law and its purposes is essential to analyzing its benefits and its complications. Bankruptcy exemptions allow debtors to retain…
An Examination of the Westinghouse Bankruptcy and the Company’s Future
On March 29, Westinghouse Electric Company filed for Chapter 11 bankruptcy to restructure after facing costly issues at power plants currently under construction.1 The filing comes slightly more than 10 years after Japanese conglomerate Toshiba acquired the company for $5.4 billion.2 Westinghouse has been known as one of the United States’ most dominant nuclear power…