Our restructuring lawyers provide creative and pragmatic solutions to troubled companies, boards and management, trustees, creditors, creditors’ committees, asset acquirers, and distressed investors. We integrate corporate and litigation expertise to devise effective strategies for addressing financial distress, restructuring debt obligations, and resolving complex issues and claims in non-judicial consensual restructurings and contentious bankruptcies. Our lawyers have represented key constituents in multiple industries, including energy, financial services, retail, construction, media-entertainment, manufacturing, aerospace, and insurance.
Our core restructuring lawyers regularly draw on the firm’s broad and deep industry and regulatory experience in areas such as communications, energy, financial institutions, life sciences, sports, technology, and transportation, as well as M&A, capital markets and securities, antitrust, environmental, ERISA, insurance, and tax practices.
Together with our international offices, we also provide advice in cross-border restructurings and complex international insolvencies involving multiple laws and jurisdictions including Europe, Asia, and Latin America.
Bankruptcy Litigation
Covington is experienced in bankruptcy litigation of all types of controversies, in bankruptcy court and other forums. Our attorneys have represented clients in a broad range of bankruptcy-related disputes, from subordination disputes to cram-down contests in plan confirmation proceedings, as well as a wide variety of financial litigation related to bankruptcy cases, including contract disputes, breach of fiduciary duty claims, avoidance actions (fraudulent transfer and preference litigation), and claims litigation. We also represent examiners in bankruptcy cases, including conducting internal investigations and evaluating potential causes of action.
Creditor Representation
Covington’s creditor practice includes representing a wide variety of clients, including bank agents and groups, creditors and ad hoc committees, financial institutions, indenture trustees, investment firms engaging in “loan-to-own” strategies, hedge funds, and trade creditors. We advise clients on formulating and negotiating financing arrangements, including DIP and exit financing facilities, as well as assist in review of a debtor’s day-to-day operational issues including employee, cash management and contractual issues. We have significant experience analyzing the debtor’s long-term strategies, negotiating plans of reorganization, and litigating inter-creditor disputes, with a view to maximizing the client’s recovery.
Debtor Representation
We assist clients navigating financial distress, providing a broad range of business advisory and crisis management services, including advising on governance and strategic review of options to develop and execute creative legal strategies and solutions to preserve corporate value. A substantial part of this focus involves bolstering liquidity and avoiding operational crisis by employing alternative financing techniques. We have significant experience guiding clients through consensual out-of-court workouts, prepackaged or pre-negotiated bankruptcies, debt and equity exchanges, contested bankruptcy proceedings, and asset sales.
Distressed M&A
We have significant experience representing parties in connection with sales of assets of distressed companies both outside of bankruptcy and via “363 transactions” in Chapter 11 cases. We combine the skills necessary for traditional M&A transactions with the specialized knowledge of bankruptcy law and procedures, fraudulent transfer, successor liability and other risk-protection, and similar issues that must be addressed to protect our clients’ interests. Our lawyers are particularly adept at acquisitions of intellectual property from distressed companies and have been involved in a number of recent transactions involving IP sales.
Insurance
Our restructuring lawyers work closely with lawyers in our preeminent insurance practice in representing policyholders in insurance coverage disputes arising in bankruptcy cases and related bankruptcy litigation. We advise clients on a variety of coverage issues, including coverage for mass-tort liability, property and business interruption losses, claims against directors, officers and employees and many other types of exposures, solvent schemes, and other issues triggered by a bankruptcy filing. We have significant experience addressing issues particular to bankruptcy proceedings, including the status and treatment of insurance policies in bankruptcy, disputes regarding the ownership of policy proceeds following bankruptcy, and the application of certain exclusions to coverage such as the “insured v. insured” exclusion in D&O policies.
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