US mortgage rates hit 5% this week for the first time in more than a decade, continuing a rapid ascent since the start of 2022.  According to The Wall Street Journal, interest on the average 30-year fixed-rate mortgage climbed from 4.72% a week ago to its highest level since early 2011.  Now, bankers and

According to Reuters, businesses are contending with increased costs as supply chain issues continue to disrupt the economy. Companies have struggled to keep up with demand for consumer goods, which soared during the pandemic. Costs include rising prices for raw materials due to halted factory production and backlogs of ships waiting to unload cargo

Fox Business reports that Boy Scouts of America’s insurer Chubb Ltd. has pledged to contribute $800 million to the Boy Scouts of America’s bankruptcy settlement deal. Boy Scouts of America, which filed for bankruptcy in February 2020, is currently on track to settle with approximately 82,500 tort claimants who claim they were sexually abused as children by troop leaders. The latest contribution by Chubb raises the total amount of available funds to resolve the claims to more than $2.7 billion. The fund is also backed by Boy Scouts of America’s primary insurer, the Hartford Financial Group, as well as the Church of Jesus Christ of Latter-day Saints. Ultimately, Boy Scouts of America’s emergence from Chapter 11 hinges on a settlement with tort claimants, and, while several victims have voiced support for the settlement deal, a separate committee of claimants voiced concerns that the deal compromises too much in exchange for a quick exit. The abuse claimants have until December 28th to vote on the reorganization. [Fox Business; Dec. 13, 2021]

Continue Reading What We’re Reading This Week [December 16, 2021]

The Economist discusses how the Omicron variant has exacerbated potential threats to the world economy, including that tightening of domestic and global travel restrictions in response to Omicron will harm growth, that the variant will cause further supply chain bottlenecks that may result in inflation heading even higher, and that the variant may cause a

Los Angeles Business Journal reports on the anticipated increase in bankruptcy filings by hotels in light of the uneven economic recovery and reduction of government support, as lender patience is expected to wear thin.

The Wall Street Journal writes that businesses are taking a wait-and-see approach to the new Omicron variant of Covid-19 that emerged

Whether—and in what circumstances—a debtor should pay creditors a make-whole premium continues to be litigated in bankruptcy courts. Last week, as reported by Bloomberg, Judge Dorsey (Delaware) ruled that the debtor – Mallinckrodt Plc – did not need to pay a make whole premium to first lien lenders in order to reinstate such obligations

On September 1, 2021, Judge Robert Drain issued a much-anticipated oral ruling approving Purdue Pharma L.P.’s plan of reorganization. The plan, which has garnered significant attention from the media, legislators, academics, and practitioners, releases current and future members of the Sackler family and many of their associates and affiliated companies – none of whom filed for bankruptcy themselves – from liability in connection with any possible harm caused by OxyContin and other opioids that Purdue Pharma manufactured and distributed. In return for the liability releases, the Sacklers will, over a nine-year period, contribute up to $4.325 billion to a settlement fund from which payments will be made primarily to compensate victims and to fund initiatives to abate the opioid epidemic.

Continue Reading SDNY Bankruptcy Court OKs Purdue Pharma’s Plan of Reorganization Featuring Third-Party Releases for Sacklers in Exchange for Contributing $4.325 Billion to Opioid Victim Settlement Fund

Mayer Brown Restructuring lawyers Lucy Kweskin and Tyler Ferguson recently published an article in Westlaw Today highlighting key bankruptcy trends in the first half of 2021, including recent court pushback on granting debtors “extraordinary” relief from rent obligations in light of the COVID-19 pandemic, lofty valuations placing equity holders in the money, and developments in

Bloomberg reports that the decrease in large U.S. bankruptcy filings may be attributable in part to the use of distressed exchanges in which creditors accept discounts on their debt in exchange for better claims on a borrower’s assets, a later maturity, or both.

The Wall Street Journal reports that Senator Elizabeth Warren plans to introduce