Our thoughts are with our friends and colleagues who are affected by Hurricane Harvey and Hurricane Irma.

In this edition, you will find recent case law updates from the Southern region (courtesy of Jeff Dutson of King & Spalding LLP) and the New England region (provided by Kevin Braun of Morgan, Lewis & Bockius LLP) as well as an overview of the recent activities and exciting future initiatives of several of the ACIC's committees courtesy of Mikhel Schecter of Paul, Weiss, Rifkind, Wharton & Garrison LLP. We have also continued our "New Member Spotlight" feature this month, courtesy of Melody Cross.

Southern Updates

 

In re Beck-Ford Constr., LLC v. TCA Glob. Credit Master Fund, LP, the Southern District Court of Florida found broad release and waiver provisions to be enforceable and held that borrowers could not sue a lender for misconduct which occurred prior to the execution of an agreement containing the broad release and waiver provisions. For more details, click here .

 

In re Blackrock Capital Inv. Corp. v. Fish, indemnification and no-liability clauses of agreements between subsidiary and parent companies were found procedurally and substantively unconscionable under New York law. For more details, click here. 

In re Jeff Benfield Nursery, Inc., a pre-petition waiver of automatic stay was found unenforceable and relief from an automatic stay was otherwise not found to be warranted where grow contracts disguised financing arrangements. For more details, click here.

 

In re Edwards Family Partnership, LP v. Bancorpsouth Bank, lenders' acquiescence to actions inconsistent with terms of a blocked account agreement resulted in abandonment and waiver of such lenders' right to enforce the agreement. For more details, click here.

In re Sentinel Capital Orlando, LLC v. Centennial Bank,  the court held that an originating bank's failure to disclose a borrower's post-default settlement offer or third-party purchase offers to a participating bank and the originating bank's rejection of the participating bank's demand to charge interest at a default rate did not breach the originating bank's obligation under a loan participation agreement to consult with and obtain the written consent of the participating bank prior to any modification, amendment or termination of any material terms in the loan documents. For more details, click here. 

New England Updates

In  re Reardon , 2017 WL 1283449 (Bkrtcy. D. Mass., Judge Bailey), the federal bankruptcy court ruled that pre-petition guaranties of post-petition extensions of credit are not subject to bankruptcy discharges.  For more details, click here.

In re Valley Nat'l Bank v. Marcano, 174 Conn. App. 206 (2017), the court held that a third party that acquires an unendorsed note has standing to enforce that note though not technically a holder of the note. For more details, click here.

In re Sagendorph, 562 B.R. 545 (D. Mass 2017), the bankruptcy court held that Chapter 13 debtor's surrender of collateral property does not impose on secured creditors a requirement to accept that property in satisfaction of its claims.   For more details, click here.

If you have ever wanted to learn more about what the various ACIC committees do and some of the exciting initiatives currently underway by them, click here.

If you are interested in getting involved in any of the ACIC's committees, please reach out to one of the applicable chairs!