Sir Richard Branson comments on laws of the United Arab Emirates and their effect on business.  This is from back in February.


 Wednesday, 12 February 2014 9:06 AM Serial entrepreneur and billionaire Sir Richard Branson has told Arabian Business he was “flabbergasted” that the UAE did not have a bankruptcy law.
Branson, who has founded dozens of businesses under the Virgin brand, said providing bankruptcy protection was a priority for a region where millions of new jobs desperately need to be created.
“I’m flabbergasted to hear there’s no bankruptcy law [in the UAE],” Branson said, speaking exclusively to Arabian Business on the sidelines of the Government Summit in Dubai.
“What transformed Great Britain was, in about 1850 the bankruptcy law was brought in and people didn’t have to go to the watch house [jail] if they went bankrupt and they had a chance to start again.
“I would say that that would be one of the first things [Gulf governments] should do if they want to encourage entrepreneurship, because who’s going to take a risk if there’s no protection?”

(posted 21 hours 3 min ago)

An interesting post from the Bankruptcy Blog about a recent ruling by Judge Rakoff concerning the interplay of section 502(d) of the Bankruptcy Code and provisions of the Securities Investor Protection Act (SIPA).



Canons of statutory construction are used frequently to resolve ambiguities in the Bankruptcy Code. In a recent decision arising out of the Madoff liquidation, Judge Rakoff of the Southern District of New York had to implement more than a few to creatively resolve a potential conflict between the Bankruptcy Code and the Securities Investor Protection Act (SIPA). He also had to take a practical, yet expansive, view of what the word “prompt” can mean when managing the untangling of one of the largest financial frauds in American history.

The Facts

(posted 22 hours 40 min ago)


Tue., July 29, 2014  Portugal's central bank said late on Monday that if Banco Espirito Santo posts a loss larger than its existing capital cushion of 2.1 billion euros ($2.8 billion), a capital increase will be used to guarantee adequate solvency levels, Reuters reported. Earlier, Expresso newspaper's online edition said BES was likely to report a loss of around 3 billion euros on Wednesday after having to assume additional debt liabilities linked to the troubled Espirito Santo group of its founding family. BES officials were not immediately available to comment. Three of the Espirito Santo family holding companies, including ESFG, which holds a 20 percent stake in BES, have requested creditor protection this month.

(posted 23 hours 19 min ago)

Unless the plaintiffs request a stay (and quick!), this will probably be the last request for Judge Griesa to stay the injunction before Argentina defaults officially fails to put money into the bank accounts of exchange bondholders. It is an emergency motion to stay filed by Knighthead Capital Management and other holders of euro-denominated bonds. They want the judge to stay the injunction for at least 90 days, so that they can try to round up votes to waive the RUFO clause, or through the end of the year, when the RUFO clause expires. They add that "a stay would not affect the plaintiffs at all, since they have not been paid since 2001..."

Credit Slips
(posted 1 day 2 hours ago)

When you’re flat broke and thinking about bankruptcy, cheaper sure looks better.
If a lawyer will do your Chapter 7 for $600, what’s the point of paying $1000? Or even $2000?
Like answers to many legal questions, it depends.
Bankruptcy relief depends on your facts
Whether to file bankruptcy, or whether to file now, rather than later, depends on how the facts of your financial situation interact with bankruptcy law.
Your bankruptcy lawyer is charged with gathering those facts and analyzing them so that you get the most debt relief the system can offer.
If your bankruptcy lawyer doesn’t dig deep enough, or think broadly enough, you may hit avoidable snags in your case.
With the caveat that there is no direct and sure-fire connection between cost and quality, let’s talk about what it costs to escape from broke.
How to figure what you should pay
The cheapest guy in town isn’t for you.  Chances are, he’s new to the field.  He’s dabbling.  He’s hoping to sell you something else along with a bankruptcy, or he’s outsourced the real work to someone with less training than he has.

(posted 1 day 2 hours ago)

Ordinarily, when a Judge tells a lawyer that he needs to be somewhere, the lawyer recognizes the need to be there. Here’s a case where the lawyer will learn that lesson the hard way. You can find the Order here.
JR-order resetting COP
It is the rare lawyer who dictates to the federal court, or any state court, when he is willing to participate in a scheduled hearing. It is an even rarer occasion that a lawyer having received an order from the federal court setting a hearing, files a pleading which says “[d]ue to scheduling conflicts and lack of time to make arrangements both counsel and [the client] are unable to appear at the Change of Plea Hearing currently set for July 29, 2014, at 9:45 am.” Perhaps such hubris would be understandable if some critical event prompted the injudicious pleading. But, reasoning that “[d]ue to a vacation, medical issues, a root canal and hundreds of emails–counsel inadvertently missed the email setting the Change of Plea Hearing in this case[,]” does not meet any standard except that of
extraordinary hubris, a standard not usually recognized in judicial proceedings. In the event that the Court’s concern is not evident, such behavior by a lawyer is unacceptable, unprofessional, and unfortunate.

(posted 1 day 3 hours ago)

As Argentina finds itself on the verge of a second default, what blame, if any, does the distressed investing community hold?

The distressed investing community holds no blame for Argentina’s risk of default.
When issuing a bond, a country makes a promise to repay its creditors on time and with interest. If Argentina is unable to do so, that’s certainly not the bondholders’ fault. The fact that the economic crisis of 1998-2002 that precipitated the original default in December 2001 stemmed from circumstances beyond Argentina’s control does not shift blame to the country’s creditors for the present crisis, nor does it create any obligation for them to agree to a massive write-down of their bond holdings. Bankruptcy Beat
(posted 1 day 4 hours ago)

Because there is additional proof needed to show undue burden, the majority of those individuals who file bankruptcy do not file the additional adversary proceeding necessary to receive a discharge. This accounts for very low number of student loan discharges given to debtors by bankruptcy courts each year. The post Student Loan Debt and Bankruptcy appeared first on Tucson Bankruptcy Attorney.

(posted 1 day 5 hours ago)

I name names and point fingers in the Wall Street Journal.  NML gets some blame for overplaying its hand, but the fault primarily lies with the federal courts for letting the case go forward. I understand the courts being angered by an unrepentant debtor thumbing its nose at them, but the federal courts should know better than to get into a pissing match with a foreign sovereign. Federal judges are possessed of awesome powers, but not that awesome. It's not at all clear to me how Judge Griesa's going to get this case out of the hole he dug, and the recent reporting on the case indicates that he doesn't have any idea either. "We're in the soup."  Indeed. 

Credit Slips
(posted 1 day 5 hours ago)

As Argentina finds itself on the verge of a second default, what blame, if any, does the distressed investing community hold?

Argentina borrowed money pursuant to certain terms and conditions. It failed to meet its obligations under those borrowings, thereby activating debt holders to exercise their contractual rights. Despite its efforts, Argentina was not able to persuade all of the debt holders to compromise and resolve their claims. The holdout debt holders have relied upon their contractual rights and they have been upheld by a series of court decisions. Enforcement of legal rights does not give rise to the stigma of blame. The issue of whether the holdout debt holders should have a “social conscience” is a wholly different subject bristling with many vagaries and different philosophies that it cannot be definitively answered. Complicated and ambiguous social and moral issues should not give rise to the attribution of blame. Blame is an inappropriate characterization in the circumstances that prevail. Bankruptcy Beat
(posted 1 day 5 hours ago)