GRR 100 2021

Young Conaway Stargatt & Taylor

Young Conaway Stargatt & Taylor

Professional notice

The Delaware firm continues to advise future victims of talc exposure in the Chapter 11 proceedings of talc producer Imerys’ US and Canadian subsidiaries

Global head of restructuring and insolvencyJoseph Barry and Sean Beach
Partners in restructuring team25
Restructuring lawyers inWho's Who Legal5

History of the practice

Young Conaway Stargatt & Taylor was founded in 1959 by Hy Young, James Conaway, Bruce Stargatt and William Taylor. Its highly regarded bankruptcy and restructuring practice – the largest in the US district of Delaware – has experience across a number of sectors, including energy, financial and professional services, food and beverages, healthcare, media and real estate.

John Dorsey, a former general counsel and bankruptcy partner at the firm, was sworn in as a US bankruptcy judge for the District of Delaware in June 2019.

Network

The bankruptcy group is based in Wilmington and has played a leading role in most significant bankruptcies in the district. Partners Joseph Barry and Sean Beach became co-chairs of the practice in 2019, taking over from Pauline Morgan, who remains with the firm as a partner.

The wider firm also has offices in Georgetown and New York.

Who uses it?

Young Conaway Stargatt & Taylor represents debtors, creditors' committees, secured and unsecured creditors, purchasers, plan sponsors and shareholder groups in jurisdictions throughout the US and further afield. It has particular experience advising private equity funds on distressed portfolios.

Past clients include Canadian gold miner Crystallex International, Chicago-based publisher Sun-Times Media Group, holding company Indalex Holdings Finance and one of the oldest professional baseball teams in the US, the Los Angeles Dodgers.

Historic track record

The firm played a major role in the huge US$7.3 billion cross-border insolvency of global telecoms group Nortel Networks, advising the joint administrators of Nortel Networks UK and its affiliated debtors in the US.

Morgan was instructed by the world’s largest print maker, AbitibiBowater, in the cross-border restructuring of its US$6 billion debt. It successfully emerged from Companies’ Creditor Arrangement Act (CCAA) and Chapter 11 proceedings at the end of 2010 and later changed its name to Resolute Forest Products.

In New York, it served as special counsel for Irving Picard, the trustee to the Madoff estate, who is charged with unpicking the US investor’s US$65 billion Ponzi scheme and paying out creditors.

Young Conaway Stargatt & Taylor also helped to complete the US$2.7 billion restructuring of Ukrainian steelmaker Metinvest via three schemes of arrangement in the UK filed in parallel with three separate Chapter 15 recognition proceedings in Delaware. Baker & McKenzie and Allen & Overy advised on the UK schemes, while Young Conaway Stargatt & Taylor took care of the US side. All three firms picked up an award for the deal at the inaugural GRR Charity Awards ceremony in 2017 for “innovation in cross-border insolvency and restructuring”.

In 2017, following the global recall of around 120 million faulty airbag inflators produced by the Takata group, three of its Japanese debtors hired Young Conaway Stargatt & Taylor as US counsel in Chapter 15 proceedings to recognise their Tokyo bankruptcies, and in a Chapter 11 for US affiliate TK Holdings. A Delaware court recognised Takata’s Japanese bankruptcy in November 2017, rejecting objections from drivers who had commenced multi-district litigation against the group. In April 2018, all of Takata’s global assets bar those relating to the manufacture of airbag inflators were sold to Michigan-based competition Key Safety Systems for US$1.6 billion, after a settlement was reached between the company, creditor groups and injured drivers.

In 2019, Young Conaway Stargatt & Taylor helped the top company of multinational logistics group Syncreon to secure US recognition of its English scheme of arrangement. Syncreon changed its New York law-governed debt to English law to complete the scheme as part of a restructuring across the UK, the US, Canada and the Netherlands.

Recent events

Jaime Chapman in Delaware was elected to join the firm’s partnership in January 2021.

Top cases of the research period

Young Conaway Stargatt & Taylor is acting as counsel to Regus Corporation as the US parent, Debtor-in-possession (DIP) lender and pre-petition secured lender of a number of co-working space providers in their Chapter 11 cases under the name RGN-Group Holdings et al that are pending in the District of Delaware. The debtors, ultimately owned by Jersey-registered but Swiss headquartered International Workspace Group, have over 1,000 locations across the United States and Canada. Some have obtained recognition of their Chapter 11 from an Ontario court, which has also separately commenced CCAA proceedings for some of its Canadian leases. Young Conaway helped Regus negotiate to provide a US$140 million term loan facility to RGN, with two amendments to the DIP order since the cases started.

Jim Patton, chairman emeritus of Young Conaway, is currently acting as future claimants’ representative for potential victims of talc exposure in Imerys Talc’s Chapter 11 proceedings, with the firm as his counsel. US and Canadian subsidiaries of the French talc producer entered Chapter 11, after the group faces thousands of lawsuits alleging that its products cause cancer. A Canadian arm of the business has also filed for CCAA protection in Canada.

Also on the debtors’ side, Morgan and partner Kara Hammond Coyle are representing international tobacco company Pyxus on a US$1.4 billion pre-packaged bankruptcy filing designed to eliminate US$636 million of second lien notes. A Delaware judge approved the tobacco-turned-hemp producer’s plan in August 2020, just over a month after the case was filed, after waving off a revaluation request from wiped-out shareholders.

The firm is further counsel to a group of Cayman Islands-incorporated funds under the Zohar name on their US$1.5 billion Chapter 11 and on the separate Chapter 11 of Dura Automotive Systems, a company to which they made term loans. In the Dura case, the firm successfully challenged a proposed debtor-in-possession financing by a Dura insider on its clients’ behalf and got the venue of the case transferred from Nashville to Delaware.

Michael Nestor and Matthew Lunn are representing KSV Restructuring as the receiver and authorised foreign representative of five GI Sportz debtors, in Delaware Chapter 15 cases for the recognition of their parallel proceedings in Quebec holding, in which they are seeking to resolve over $28 million in secured indebtedness. The firm secured recognition of the receivership order entered by the Quebec Court in October 2020, as well as a vesting order through which GI Spotz’ assets were sold to an affiliate of Fulcrum Capital Partners.

Outside the research period, Nestor and Lunn received a new instruction as US counsel to Alvarez & Marsal as foreign representative to a group of companies that operate the Japanese restaurant chain Sarku Japan. The companies have entered CCAA proceedings in Canada and Alvarez & Marsal as monitor sought Chapter 15 recognition in Delaware. Since the summer of 2021, Morgan and partners Sean Greecher and Andrew Magaziner have also been working alongside Simpson Thacher & Barlett for Corp Group Banking, part of one of Chile’s largest conglomerates, and its subsidiaries in the US as they seek to restructure more than US$1.8 billion in debt via Chapter 11.  

Young Conaway Stargatt & Taylor, LLP provides clients with a full range of legal services across multiple, award-winning practices, including Bankruptcy and Corporate Restructuring, Corporate Litigation and Counseling, Intellectual Property Litigation, Business and Tax. Our attorneys collaborate to provide creative, client-centric solutions to a range of entities, including national and international corporations, small businesses and individuals. 

Young Conaway’s Bankruptcy and Corporate Restructuring Section, comprised of 42 lawyers and ten paralegals, is one of the largest in Delaware and the Mid-Atlantic region.  Our attorneys possess a deep knowledge of all facets of the restructuring process and serve as lead and co-counsel with colleagues from the most well-respected law, financial advisory, accounting, investment banking, and restructuring firms throughout the U.S. and worldwide.  The team routinely represents debtors, creditor committees, future claimants, private equity firms, and other stakeholders in some of the most significant bankruptcy matters being decided in the courts today.

Young Conaway’s representation of financially troubled corporate entities has earned it a national reputation as an outstanding insolvency practice group. Chambers USA: America’s Leading Lawyers for Business identified Young Conaway as Delaware’s “[p]remier practice notable for the strength and depth of its bankruptcy team, which houses numerous highly skilled attorneys.”  Clients interviewed by Chambers USA remarked that Young Conaway’s bankruptcy attorneys are “very smart, practical and easy to work with” and that the advice they provide “on overarching strategic and legal matters are equally, if not more, important as their input into local Delaware rules and practices.”  The reputation of both the firm and the Bankruptcy and Corporate Restructuring Section continues to grow outside of the United States, as confirmed by the team’s multiple nominations at the Global Restructuring Review Awards and recognition in the GRR 100 guide to the world's leading law firms for cross-border restructuring and insolvency matters. 

Website: www.youngconaway.com

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