Global Restructuring Review - Cross-border restructuring and insolvency legal news, features and events

GRR Awards 2019 – litigation

Kyriaki Karadelis

17 May 2019

GRR Awards 2019 – litigation

Barcelona at dusk (Credit: iStock.com/querbeet)

The list of nominees for “Most significant restructuring or insolvency-related litigation” at the GRR Awards 2019 is out.

On 15 June, the GRR Awards 2019 will be held in the beautiful El Palace Hotel in Barcelona, one night before the opening reception for the International Insolvency Institute’s 19th Annual Conference.

Starting from 7pm, the evening will begin with a networking reception followed by dinner. Trophies will then be awarded in 11 categories, celebrating the people, places and matters that impressed in the cross-border restructuring and insolvency sector over the past year.

In addition to the 11 awards categories, we will be revealing the top 30 firms in the GRR 100 2019 – our annual guide to approved cross-border insolvency and restructuring law firms – which will be presented to the wider public on the morning of Monday 17 June.

During March and April, we asked readers to submit nominations for several of the awards categories.

We have already revealed the shortlist for “Noteworthy Spanish restructuring matter”, “Most important cross-border recognition decision”, “Innovation in cross-border insolvency”, “Cross-border cooperation in a specific restructuring or insolvency matter” and “Jurisdiction of the year”.

See below now for the nominees for “Most significant restructuring or insolvency-related litigation”.

Shortlists for the remaining categories will be published in GRR over the next few days, after which we will also be unveiling the recipient of our annual Lifetime achievement award.

For full details about the GRR Awards 2019, as well as photos from last year and to book a place, please visit our event website.

All profits from the GRR Awards go to the Swawou Layout Community Primary School for Girls in Sierra Leone, which was established in 2008 by GRR’s parent company, Law Business Research, to offer free primary education to girls from disadvantaged homes in Kenema town, eastern Sierra Leone.

Most significant restructuring or insolvency-related litigation - nominees

Swiss Ribbons Pte Ltd v Union of IndiaJustices Rohinton Nariman and Indu Malhotra at the Supreme Court of India, 25 January 2019. The Supreme Court of India upheld the constitutionality of India’s 2016 Insolvency and Bankruptcy Code (BIC), dismissing arguments that the Code discriminates against operational creditors and upholding a ban on promoters of corporate debtors from submitting resolution plans.

ArcelorMittal India Pte Ltd v Satish Kumar GuptaJustices Rohinton Nariman and Indu Malhotra at the Supreme Court of India, 4 October 2018. This time the Supreme Court identified the grounds under which a bid applicant can be disqualified, issuing some much-needed interpretation of section 29A of India’s IBC, which was a later addition to the Code in 2017. The justices ruled that a piercing of the corporate veil is required to assess the true ownership of a bid applicant, and that a committee of creditors should take the final decision on disqualification of potential promoters after obtaining a prima facie opinion from a resolution professional.

GITIC Hong Kong (Holdings) LtdJustice Jonathan Harris at the Hong Kong High Court, 10 October 2018. Justice Harris allowed Hong Kong liquidators to depart from the local pari passu rule so they could distribute mainland Chinese assets in accordance with local rules. The decision resolved a cross-border legal hurdle raising the prospect of closing the company’s bankruptcy after 20 years.

Orphan Well Association and Alberta Energy Regulator v Grant Thornton and ATB Financial - Supreme Court of Canada, 31 January 2019. The Supreme Court of Canada found that an energy company’s environmental obligations survived its bankruptcy, obliging its receivers to use the company’s assets to clean up its abandoned wells. Commentators say the decision has effectively given regulatory obligations absolute priority over secured and unsecured claimants in Canadian bankruptcies.

In re Ahmad Hamad Algosaibi & Brothers (AHAB) v Al-Sanea & OrsChief Justice Anthony Smellie in the Grand Court of the Cayman Islands, 31 May 2018. Chief Justice Smellie dismissed US$4 billion in fraud claims by Saudi conglomerate Ahmad Hamad Algosaibi & Brothers (AHAB) against its former head of investment Maan Al-Sanea and several of his investment vehicles under the Saad Group, finding the company knew of and authorised the fraudulent borrowing. The judge described the fraud perpetrated against more than 100 Saudi and international banks as “one of the largest Ponzi schemes in history”. AHAB has appealed. 

In the Matter of CW Advanced Technologies LimitedMr Justice Jonathan Harris, Hong Kong High Court, 19 July 2018. Justice Harris issued this warning judgment telling Hong Kong’s lawmakers the territory urgently needs a statutory cross-border regime, as he advised an engineering group to use local provisional liquidators to manage its assets in the special administrative region because the court may not be able to recognise its Singapore moratorium. The group’s Hong Kong entity was subsequently wound up.

In re: Asiatravel.com Holdings Ltd Justice Kannan Ramesh, Singapore High Court, 8 April 2019. The Singapore High Court approved the first-ever super priority order under the city-state’s new Companies Act, in favour of a creditor of struggling online travel platform Asiatravel.com Holdings. The court relied on US case law in light of super-priority financing being “alien” to common-law Companies Law regimes.

In re: Irving Picard, trustee for the liquidation of Bernard L Madoff Investment SecuritiesJudge Richard Wesley, Judge Rosemary Pooler and Judge Dennis Jacobs, US Court of Appeals for the Second Circuit, 25 February 2019. A US appeals court undid a three-year-old district court ruling, finding that principles of international comity should not stop the trustee of Bernie Madoff’s investment firm (BLMIS) from recovering assets that he claims were fraudulently transferred to foreign feeder funds and passed on to their investors. The three-panel bench in the appeals court led by Judge Richard Wesley found that such transfers from the feeder funds to their international investors could be regulated under US domestic legislation because the initial transfers from New York entity BLMIS were from a US bank account. The case has sharply divided restructuring and insolvency practitioners in the US and offshore, and at least five amicus curiae briefs were submitted to the court with arguments for and against extraterritorial clawback.

Between BTI 2014 LLC and Sequana SA and othersLord Justice David Richards, Lord Justice Henderson and Lord Justice Longmore, England and Wales Court of Appeal, 6 February 2019. A director’s duty to act in the best interests of creditors can be triggered when a company is not actually insolvent, the English Court of Appeal ruled as it barred a €135 million dividend payment made to French paper company Sequana by its UK subsidiary, which it found was intended to put funds beyond the reach of creditors. The court affirmed the dividend counted as a “transaction at an undervalue” under section 423(1) of the Insolvency Act.

Serviços Petróleo de ConstellationJudge Neville Adderley, BVI Commercial Court, 4 February 2019. In a first for the offshore jurisdiction, a British Virgin Islands court approved an application to appoint soft-touch provisional liquidators in the debt restructuring of a Brazilian oil and gas group.

Re IM Skaugen SEJustice Kannan Ramesh, Singapore High Court, 27 November 2018. A contested moratorium application allowed Singapore’s High Court to set out the requirements for a successful moratorium request under Singapore’s new Companies Law, in what ultimately turned out to be a failed restructuring of entities belonging to Norwegian gas carrier IM Skaugen.

In re: Irish Bank Resolution Corporation (in special liquidation), Debtor in a foreign proceedingJudge Christopher Sontchi, US Bankruptcy Court for the District of Delaware, 31 October 2018 (oral ruling). An Irish retail investment company tried and failed to bring a suit in the United States against the foreign representatives of the Irish Bank Resolution Corporation (IBRC), with a Delaware court finding the proposed action “would go well beyond what’s contemplated by Chapter 15”. Judge Sontchi said the court lacked subject matter jurisdiction over the suit since the conduct at the heart of the dispute had occurred in Ireland, and also lacked personal jurisdiction over IBRC’s foreign representatives Kieran Wallace and Eamonn Richardson. The court said IBRC’s automatic stay affected the adversary suit because there was “a significant identity of interest” between the debtor and its foreign representatives. It also upheld the Barton doctrine that leave of the appointing court must be obtained before a suit is brought against a court-appointed officer: recognising the officers is not appointing them, Judge Sontchi reasoned.

Goldman Sachs International v Novo Banco SA & Guardians of New Zealand Superannuation Fund and others v Novo Banco Lord Mance, Lord Sumption, Lord Hodge, Lady Black and Lord Lloyd-Jones, UK Supreme Court, 4 July 2018. In a ruling hailed as “a victory for common sense”, the UK Supreme Court confirmed that EU member states must recognise bank resolution decisions taken by other EU member states. In doing so, it said that English courts must respect Portuguese law on whether an US$835 million loan facility should have been transferred from Portugal’s collapsed Banco Espirito Santo (BES) to “good bank” Novo Banco, even where the state changed its mind upon new information.