Bankruptcy & Restructuring

Our practice has an extensive background in complex workouts and restructurings worldwide, and our reputation with financial institutions enhances our ability to assist lenders and distressed borrowers in both the workout and bankruptcy context. 

Supported by Morgan Lewis’s multidisciplinary depth and intimate involvement in a wide range of industries, our practice has represented a diverse variety of debtors, including financial service, retail, travel, airline, telecommunications, shipping, energy, and mortgage trust companies. We are thought leaders in the area of DIP lending and frequently represent key creditors and asset purchasers in bankruptcy cases.

Our work for clients includes the following:

• Restructuring troubled loans and debt securities, and recovering secured assets by judicial and nonjudicial means 
• Counseling lenders and institutional investors on preworkout agreements and other lender liability–avoidance matters
• Advising clients dealing with financially troubled third parties, including troubled banks, insurance companies, and other financial institutions
• Representing clients in state and federal court foreclosures and secured asset recovery proceedings
• Advising clients in negotiating and restructuring troubled real estate and natural resource projects, including reorganizations and other new financings or investments
• Advising clients on workouts outside bankruptcy, including loan modification agreements, exchange offers, tender offers, and consent solicitations for debt securities, asset swaps and sales, and conveyances

In bankruptcy proceedings, our capabilities include the following: 

• Advising on stays against lien enforcement, set-offs, preferences, fraudulent conveyances, leveraged buyouts, and the power of the DIP or trustee to assume or reject leases and executory contracts
• Determining avoidance actions in connection with preferences and/or fraudulent conveyances

Our deep bench of trial and appellate lawyers focuses on insolvency litigation, bankruptcies, and creditors’ rights. The insolvency litigation lawyers in our practice are not only high-quality litigators, but also adept bankruptcy and insolvency law practitioners. This position within a firm is unique, as these lawyers have a command of the issues arising in workouts, restructurings, contentious insolvencies, and the litigation adjacent to insolvency proceedings.

Our bankruptcy litigation lawyers help clients address and overcome issues that typically arise when enforcing and defending creditors’ rights inside and outside of bankruptcy. We regularly assist clients with claim litigation and enforcement, prosecution of claims against directors and officers, fraudulent transfer and make-whole defenses, rejection or modification of collective bargaining agreements and retiree benefits under Sections 1113 and 1114 of the US Bankruptcy Code, and issues relating to lender liability. We have experience with the following:

• Litigating plan confirmation
• Litigating creditors’ rights during bankruptcy cases 
• Defending avoidance and turnover actions
• Pursuing high-stakes bankruptcy appeals in lockstep with our firm’s appellate practice
• Pursuing alternate recovery sources
• Defending creditors’ rights outside of bankruptcy and other international court proceedings

Our lawyers represent insurance regulators, policyholders, and creditor groups in insurance company restructurings, receiverships, and liquidations globally. We represent clients across the entire industry, including property casualty companies, health insurers, health maintenance organizations, life insurers, financial guarantors, and mortgage insurers. Our experience includes both in-court and out-of-court restructurings as well as litigation of contested receivership matters.

We also have experience with insurance products in insolvency proceedings. This experience includes appearing in mass tort bankruptcies—including the first prepackaged mass tort bankruptcy—and representing clients in major disputes over surety bonds and related indemnity obligations in US Chapter 11 cases. In addition, we have unparalleled depth in loss-sensitive insurance programs utilized by most major insureds.

A world leader in the energy industry, Morgan Lewis has guided clients through every up cycle and down cycle. Collaborating closely with our global energy team that handles the acquisition, divestiture, structuring, development, and financing of upstream, midstream, and downstream energy assets, our restructuring team has deep energy industry knowledge—particularly in oil and gas restructurings.

Our energy industry restructuring clients include lenders, creditors, and debtors at every level of the capital structure. Our work on behalf of clients spans virtually every facet of the energy industry spectrum, including matters involving rejection of power purchase agreements, enforcement of arbitration procedures, plan and claims reserve negotiations, and litigation and settlement of rejection damages claims.

Our US Chapter 11 bankruptcy experience includes representing international power producers, major coal companies in the United States, and lenders to offshore drilling companies. We have advised various noteholder groups in numerous successful in-court and out-of-court restructurings for energy industry companies, lenders (as prepetition secured lenders and DIP lenders) in numerous restructuring cases around the globe, and second lien lenders in US Chapter 11 restructurings.

In a challenging environment, our team’s diverse retail knowledge and command of the legal issues that lenders, creditors, and borrowers face enable us to navigate complex financings and provide truly meaningful value to our clients.

Our team represents leading financial institutions and other creditors around the world in both the administrative agent and lender capacities in a broad range of retail industry financings, including private equity acquisition loan transactions, refinancings, workouts, and distressed (DIP and exit financing) situations. Our clients’ borrowers and debtors operate across the full range of retail goods and services, and include national and regional companies and ecommerce businesses in the department store, apparel, jewelry, grocery, pharmacy, furniture, electronics, and specialty spaces.

Clients benefit from our group of talented debt finance and restructuring professionals who bolster our comprehensive representation throughout the entire retail finance transaction lifecycle—from initial loan documentation through payoff, including out-of-court restructurings, bankruptcy filings, going-out-of-business and other asset sales, receiverships, and litigation.

We have experience in US municipal financings and restructurings. Our clients include secured creditors and financial guarantors such as municipalities, hospitals, Native American–sponsored casinos, and special-purpose entities, in a wide array of proceedings. We have represented major positions in US Chapter 9 and Chapter 11 cases, as well as in out-of-court restructurings, foreclosures, and receiverships.

Our experience includes advising on the largest restructuring in the world and the largest public debt restructuring in US history. This experience includes representing hedge funds in their investments in more than $1.6 billion in bonds issued by Puerto Rico and its various instrumentalities, which involves a new federal law—the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA)—being applied and interpreted for the first time. We have succeeded in numerous PROMESA litigated issues and are lead parties in the ongoing mediation efforts to obtain additional creditor consensus for a plan of adjustment. 

Our US bankruptcy practice handles the largest and most complex bankruptcy matters across the United States. Our bankruptcy and restructuring lawyers regularly represent a wide variety of constituencies in navigating US Chapter 11, including secured and unsecured creditors, equity sponsors, asset purchasers, executory contract counterparties, and creditors’ committees. Our Chapter 11 experience spans a wide variety of industries, and we are well known in the busiest bankruptcy courts, including Delaware, the Southern District of New York, and the Southern District of Texas.

We advise DIP lenders on priority, exposure, collateral, cash monitoring, and asset valuation. Our background encompasses flexible loan arrangements secured by a wide variety of assets. Our work for clients involves assisting DIP lenders in navigating all aspects of the US Chapter 11 process as well as insolvency proceedings in other countries. We take a comprehensive approach to understanding our clients’ industry-based needs and have particular experience representing asset-based lenders in the retail industry and reserve-based lenders in the oil and gas industry.

Our bankruptcy and restructuring acumen—bolstered by our ability to leverage the talents of colleagues across our firm and around the world who specialize in virtually every area of law—mean that we are superbly positioned to maximize outcomes for distressed companies. We represent boards and companies in the “zone of insolvency” in out-of-court restructurings, sales, and US Chapter 11 bankruptcy cases. Our representation of distressed companies covers both public and privately held entities in many industries.

Morgan Lewis has represented numerous official and unofficial unsecured creditors’ committees in large, complex US Chapter 11 cases and out-of-court restructurings across various industries, including retail, media and entertainment, packaging, manufacturing, energy, and transportation.

Our lawyers have represented Official Committees of Unsecured Creditors in US Chapter 11 cases involving the following companies:

• Covia Holdings Corp.
• White Star Petroleum
• Allied Holdings
• BearingPoint
• Global Power Equipment Group
• Infotelecom
• Sea Containers
• Woodside Homes
• Toisa Ltd.
• B+H Ocean Carriers Ltd.
• US Shipping Partners
• Hawaii Superferry
• Bender Shipbuilding & Repair
• Derecktor Shipyards
• TMT Procurement Corp.
• Metro Fuel Oil Corp.
• Suntech America
• Breitburn Energy Partners LP
• Chrysler LLC
• General Motors Corp.
• Penn Virginia Corp.
• Smurfit-Stone Container Corp.
• Westinghouse Electric Company LLC
• AOG Entertainment Inc. 

Morgan Lewis regularly represents trustees in defaulted and stressed bond issuances worldwide. These representations have included significant matters in the oil and gas, power, and aviation industries as well as representation of trustees acting in residential mortgage-backed securities (RMBS) structures.

We have global experience advising private equity clients on distressed portfolio companies. Our work includes representing (1) sponsors in the structuring of investments, (2) equity in out-of-court workouts, and (3) both sponsors and the portfolio companies themselves in US Chapter 11 proceedings, including fraudulent transfer defense.

Because private equity clients often find opportunity in financial distress, we advise on the best ways to acquire assets from troubled businesses through schemes of arrangements, private placements, and other out-of-court transactions.

We routinely represent dealers and buyers in bankruptcy claims trades and other transactions concerning distressed companies around the world.

Our practice has handled some of the largest and most complex restructuring and insolvency proceedings in England, France, Russia, Kazakhstan, the United Arab Emirates, Japan, China, and Singapore, among others. Our restructuring and insolvency lawyers regularly advocate for the entire gamut of creditor interests in court proceedings for secured, unsecured, and subordinated creditors; equity sponsors; executory contract counterparties; and official creditors’ committees.

Our London restructuring practice is one of the leading legal advisers in sovereign debt matters. Our experience in this space includes representing investors in Argentine bonds and nationalized businesses in Venezuela, creditor groups in Puerto Rico and Iceland, and sovereigns such as Kazakhstan, Suriname, and Laos, among others.

We represent major stakeholders in legal proceedings and restructurings regarding failed investment funds, including related global investigations and proceedings in the British Virgin Islands, the Cayman Islands, and other jurisdictions.