Client Alert: 2nd Circuit Affirms Debtor’s Decision to Nix Sale After Market Price Increases

In a decision that will be of interest to distressed investors and sellers and buyers of bankruptcy claims, the United States Circuit Court of Appeals for the Second Circuit affirmed a lower court decision which permitted a claims seller – and debtor in bankruptcy – to disapprove a trade confirmation after the market price had risen post-trade.

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Douglas Schneller handles a broad range of complex transactional matters involving bank finance and lending; restructuring, bankruptcy and insolvency; intercreditor and subordination arrangements, including for mezzanine, leveraged, multi-lien and unitranche financings; claims analysis and reconciliation; and purchases and sales of par and distressed assets such as bank loans, notes, accounts receivable, trade claims, bankruptcy claims, and equity interests. He also counsels clients on a range of other transactional matters, including trade and receivable finance (including default-triggered puts and vendor/account receivable and trade financing); bankruptcy transactional matters including distressed investing, rescue and debtor-in-possession finance, and sales under Bankruptcy Code Section 363; corporate trust and agency; structured products; private placements; portfolio management and monitoring; and securities law matters.