Restructuring Litigation

Ropes & Gray’s business restructuring and litigation departments coordinate seamlessly to advance and protect our clients’ interests in insolvency-related litigation. From challenges to cash collateral orders and break-up fees to contested confirmation hearings to the prosecution and defense of fraudulent transfer and director and officer claims, our deep bench of trial and appellate litigators has the experience and insight to identify and execute successful litigation strategies. Our victories have not only provided great returns for our clients, but also, in some cases, have helped shape the future of bankruptcy law.

Among the Ropes & Gray insolvency litigation team’s recent and most notable cases and proceedings are:

• Tempnology, LLC n/k/a Old Cold LLC – We represent Tempnology, LLC n/k/a Old Cold LLC, as respondent in an appeal pending before the United States Supreme Court that addresses the fundamental question of whether the rejection of a license by a debtor-licensor under section 365 of the Bankruptcy Code terminates the rights of the non-debtor licensee.
• Energy Future Holdings Corp. – We represented Elliott Management Corporation and certain of its managed funds as the holder of approximately $2.6 billion in claims in the chapter 11 cases of Energy Future Holdings Corp. and its affiliated debtors. On behalf of Elliott, Ropes & Gray:
  • Successfully opposed the merger of the debtors’ regulated distribution subsidiary and Berkshire Hathaway in favor of a superior offer from Sempra Energy.
  • Achieved the reconsideration and disallowance of a $275 million termination fee relating to a prior, failed transaction with NextEra Energy, including an affirmance on appeal from the reconsideration order to the Third Circuit.

Ropes & Gray had previously represented Delaware Trust Company, as indenture trustee for certain first-lien notes issued by Energy Future Intermediate Holding Company LLC, in make-whole premium litigation that resulted in a favorable and precedential decision from the Third Circuit.

• Momentive Performance Materials Inc. – We represented Wilmington Trust, National Association as indenture trustee for $250 million in 1.5 lien notes issued by Momentive Performance Materials Inc. On behalf of Wilmington Trust, Ropes & Gray contested the confirmation of a plan of reorganization that proposed to cram down the 1.5 lien notes with a below-market interest rate and prevailed on appeal to the Second Circuit, which held that the bankruptcy court must apply a market rate of interest on cram-down notes if an efficient market exists.
• Financial Oversight and Management Board for Puerto Rico – We represented Knighthead Capital Management, LLC in successfully opposing a debtor-in-possession financing proposal in the Title III case of the Commonwealth of Puerto Rico that would have unnecessarily primed certain secured creditors.
• Tribune Fraudulent Conveyance Litigation – We represent approximately 30 clients (including major public and private pension plans) and serve on the executive committee of defendants in multiple fraudulent conveyance actions arising from the failed LBO of Tribune Company. Ropes & Gray also serves as liaison counsel for the shareholder defendants in one of these actions, briefing and arguing motions in the trial court and appeals to the Second Circuit.
• Filed an amicus brief with the United States Supreme Court in Merit Management Group, LP v. FTI Consulting, Inc., which addressed the limits of the statutory safe harbor for settlement payments in securities transactions.
• GenOn Energy, Inc. – We represented holders of approximately $1.7 billion in unsecured notes issued by GenOn Energy, Inc. and its subsidiary, GenOn Americas Generation, LLC, in the negotiation of a settlement with GenOn’s parent company, NRG Energy Inc., and the negotiation of a prearranged plan of reorganization to implement that settlement and the restructuring of GenOn. Contemporaneous with settlement negotiations, Ropes & Gray sued NRG Energy Inc. and certain of its affiliates in Delaware Superior Court for the avoidance of fraudulent transfers, breaches of fiduciary duty and related causes of action.
• Executive Benefits Insurance Agency v. Arkison – We represented EBIA on appeal before the United States Supreme Court, arguing that the constitutional right to an Article III tribunal identified in Stern v. Marshall is not waivable by consent, and that bankruptcy judges lack statutory authority to submit proposed findings of fact and conclusions of law to a district court in a “core” proceeding where the bankruptcy court lacks the constitutional authority to adjudicate the matter under Stern.