Client Alert
| August 28, 2009
Commercial Lenders Under Attack: SPEs Are Not Bankruptcy Proof
Recently courts have rendered decisions demonstrating how bankruptcy statutes and jurisprudence can override the words and intent of loan documents and lenders' remedies notwithstanding the widespread concern about the fiscal health of our lending institutions and the need for them to recover to unfreeze the credit markets and permit economic growth to resume. So far, the public policy of debtor rehabilitation has trumped creditors' rights. Although one might assume that these decisions involve only residential transactions protecting middle income home owners caught up in the tsunami of the global economic recession, they do not. Some of these decisions involve hundred million dollar commercial loans.
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This memorandum is intended only as a general discussion of these issues. It is not considered to be legal advice. We would be pleased to provide additional details or advice about specific situations. For additional information on this important topic, please feel free to call upon your Dewey & LeBoeuf relationship partner. No part of this publication may be reproduced, in whole or in part, in any form, without our prior written consent.
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