On August 26, 2014, the U.S. Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) issued a notable decision in the chapter 11 cases of MPM Silicones, LLC and its affiliates (the “Debtors”) that could have far-reaching implications for future chapter 11 cases, particularly as it strengthens a debtor’s ability to cram down a dissenting class of secured creditors with new secured debt at a below market interest rate.

The Bankruptcy Court issued rulings on three issues that could negatively impact creditors in future cases:

The Bankruptcy Court held that the appropriate interest rate for debt to … Read more

On June 9, 2014, the U.S. Supreme Court issued its decision in Executive Benefits Ins. Agency v. Arkison,[1] which partially resolved procedural uncertainty created by the Court’s prior decision in Stern v. Marshall.[2]

In Stern, the Supreme Court analyzed the constitutionality of 28 U.S.C. § 157, which in relevant part defines certain matters as “core” or “non-core,” and authorizes bankruptcy courts to finally adjudicate “core” matters but only to issue findings and conclusions subject to de novo review in “non-core” matters. The Court held that Article III of the U.S. Constitution prohibits Congress from vesting bankruptcy judges … Read more