The ongoing restructuring of the Puerto Rico Electric Power Authority (PREPA) is one of the largest ever in the electrical power generation industry within the jurisdiction of the United States. The goal is to transform the utility from a bankrupt, mismanaged public corporation into a privately...
The bankruptcy of the Commonwealth of Puerto Rico and its instrumentalities is unprecedented in legal complexity and scale, with more than $120 billion of municipal liabilities subject to restructuring. To organize and facilitate this task, on June 30, 2016, President Barack Obama signed into law...
On January 18, 2022, the U.S. District Court for the District of Puerto Rico entered an order under the Puerto Rico Oversight, Management, and Economic Stability Act, 48 U.S.C. §2101 et seq. (PROMESA), confirming a plan of adjustment for the Commonwealth of Puerto Rico and certain of its...
The Title III case of the Commonwealth of Puerto Rico has been much discussed in restructuring circles since the Financial Oversight and Management Board (FOMB) of Puerto Rico commenced the case approximately five years ago, on May 3, 2017. While many mainland discussions have centered on the...
A 10-figure bankruptcy demands innovative approaches to case management and court administration, especially where large numbers of adversary proceedings are expected. One trend in recent cases—pre-discovery mediation—is proving successful in that regard, although it does have potential pitfalls of...
For decades, mediation in bankruptcy has been a preferred method for resolving disputes involving distressed entities, and the enactment of the Small Business Reorganization Acct (SBRA), which became effective on February 19, 2020, practically ensured that this trend would continue. Since the 1980s...
Complex Chapter 11 practice is, at its core, an exercise in consensus building. Mediation has historically been and remains a valuable tool in helping parties involved in Chapter 11 cases (large and small) reach consensus. Two recent examples underscore the value of mediation as a consensus...
On February 1, 2022, amended local rules for the U.S. Bankruptcy Court for the District of Delaware went into effect. Among other things, the Bankruptcy Court’s revised local rules clarify the scope of mediation confidentiality protections. The amended local rules are likely to be seen as welcome...
Frequently, parties locked in a dispute in a bankruptcy case are able to reconcile their differences through a mediation process, as permitted by the local rules and often with encouragement of the court. While Bankruptcy Courts welcome mediation between consenting parties, a court’s discretion is...
Many complex litigation and bankruptcy issues are best suited for discussion outside of the purview of the bankruptcy judge, and the parties would be well served to test the strengths (and weaknesses) of their positions in a mediation setting. Financial advisors play a key role in preparing their...
