On March 15th, CNN Business reported that the Federal Reserve has created a new rescue plan to prevent another SVB-like collapse from occurring. The new plan, titled the Bank Term Lending Program (BTLP), allows financial institutions to borrow cash from the Federal Reserve for up to one year backed by bonds, mortgage-backed securities
Law360 recently published an article by Mayer Brown restructuring partners Sean T. Scott and Aaron Gavant and associate Josh Gross, regarding the Third Circuit’s recent decision directing the dismissal of J&J affiliate LTL Management’s mass tort bankruptcy filing. The article expands upon a prior post on the decision and discusses potential implications of the Third
On March 6th, The Wall Street Journal reported that remote working environments have seriously jeopardized the recovery of business-focused hotels, boosting default risks within the sector. While leisure travel has rebounded since the second half of 2022, the recovery for facilities with large meeting rooms that rely on business trips and conferences, has
In a recent article, Mayer Brown’s Matthew Wargin, Aaron Gavant, Jade Edwards, and Lauren Wray examine a new iteration of coercive sanctions imposed on potentially “double dipping” foreign creditors in Latin American airline Avianca’s chapter 11 case in the Southern District of New York. Avianca sought to sanction over 150 foreign creditors, asserting that
According to The Wall Street Journal, Teva Pharmaceutical Industries Ltd. has reached a national settlement agreement worth nearly $5 billion, including about $3.7 billion in cash, to resolve thousands of lawsuits over its alleged role in the opioid crisis. The plaintiffs’ executive committee, which represents local and state governments and Native American tribes, reported
In a new opinion issued in the Chuck E. Cheese bankruptcy cases, In re CEC Entertainment, Inc., Case No. 20-33163 (Bankr. S.D. Tex.),1 Judge Marvin Isgur of the U.S. Bankruptcy Court for the Southern District of Texas ruled2 that CEC Entertainment, Inc. (“CEC”), the parent company of the Chuck E. Cheese pizza chain, could not defer its rent obligations due to ongoing COVID-19 disruptions beyond the initial 60-day period authorized by section 365(d)(3) of the Bankruptcy Code. While CEC had initially sought rent relief with respect to dozens of its store locations, it was able to settle with the landlords for all but six locations in North Carolina, Washington, and California; the non-settling landlords continued to insist that CEC was required to pay rent despite the global pandemic and CEC’s bankruptcy filing. In its December 14, 2020 opinion, the court agreed with these landlords and rejected each of CEC’s arguments for its proposed relief, including that: (1) sections 105 and 365 of the Bankruptcy Code authorized the Bankruptcy Court to suspend CEC’s rent obligations beyond the 60-day period included in Section 365(d)(3); (2) the COVID-19 pandemic—and related restrictions put in place by state and local governments—constituted a force majeure event under each of the six leases at issue; and (3) CEC’s inability to fully utilize the leased premises as a result of state and local restrictions on indoor dining and entertainment entitled CED to a “frustration of purpose” defense with respect to each lease.
Continue Reading Opinion of Interest – In re CEC Entertainment Inc.: COVID Disruptions Do Not Justify Additional Rent Deferrals Beyond Initial 60-Day Period Expressly Permitted by Bankruptcy Code
AMC Entertainment Holdings Inc. announced that it is exploring financing alternatives to address the financial strain on the company resulting from the COVID-19 pandemic, including an at-the-market sale of 178 million shares, reports The Street. This announcement comes after Walt Disney Co. announced that approximately 80% of its new content in 2021 would be
Business Insider reports that AMC Theaters recently sought to raise up to $844 million through stock sales to improve its financial condition, which has been substantially weakened due to restrictions on indoor gatherings put in place in response to the COVID-19 pandemic. AMC’s stock price took a major hit after Warner Bros. announced it would
Mayer Brown partners Sean Scott and Aaron Gavant and associates Tyler Ferguson and Alexander Berk discussed the United States Bankruptcy Court for the Southern District of Texas’ most recent decision arising out of the Ultra Petroleum Corp. bankruptcy case and its rulings that (1) make-whole premiums are allowed by the Bankruptcy Code under appropriate circumstances
CEC Entertainment, the parent company of kid-friendly and iconic “dinnertainment” restaurant and arcade chain—Chuck E. Cheese—sought and received Bankruptcy Court approval for three very unique settlement agreements, earlier this year, under which it will pay $2.3 million to three vendors to destroy roughly seven BILLION prize tickets – i.e., enough tickets to fill approximately 65 forty-foot cargo shipping containers.1 The backlog was caused by Chuck E. Cheese placing orders for tickets at pre-COVID utilization rates, the resulting pandemic and rapid fallout in sales, and, most generally, Chuck E. Cheese’s efforts to transition from physical tickets to contactless transactions, like “e-Tickets.”2
Continue Reading The Costs of Destruction: Bankruptcy Court Authorizes Chuck E. Cheese to Spend Millions on Destruction of Prize Tickets