Business Restructuring Review

In this issue:

• The Visteon Decision: Third Circuit Expands Section 1114 Protections to Terminable-at- Will Retiree Benefit Plans
  The Third Circuit ruled that the procedures set forth in section 1114 of the Bankruptcy Code apply to all retiree benefit plans, even plans that could have been terminated at will outside of bankruptcy, reaching the opposite conclusion on this issue from the majority of courts that have previously considered it.
• Municipal Bankruptcies: A Horse of a Different Color
  Rulings by a California district court and a New York bankruptcy court highlight important distinctions between chapter 9 bankruptcies and cases under other chapters of the Bankruptcy Code.
• Newsworthy
• Fifth Circuit Allows Debtor to Avoid Insider Severance Payment as a Fraudulent Transfer
  The Fifth Circuit upheld a ruling avoiding prebankruptcy severance payments to a corporate executive as fraudulent transfers under section 548.
• Caveat Vendor: Eleventh Circuit Rules That Unauthorized Payments by DIP Using Cash Collateral Must Be Disgorged
  The Eleventh Circuit put vendors who trade with a DIP on notice that unauthorized payments by a DIP using cash collateral can be avoided and recovered by the estate.
• No Unwaivable Right to File an Involuntary Bankruptcy Petition
  The Second Circuit affirmed a district court order denying a request to dissolve an anti-litigation injunction barring nonparties from filing involuntary bankruptcy petitions against entities whose property was subject to SEC receivership.