The Energy Restructuring & Creditors’ Rights (“ERCR”) team at Sutherland offers depth and industry-specific knowledge of the critical issues facing national and international clients involved in energy company bankruptcies – either as creditors or debtors. The ERCR team has been involved in some of the largest and most significant bankruptcies of energy companies, including those of Enron, Mirant, National Energy & Gas Transmission and The Power Company of America. The ERCR team is comprised of ten professionals drawn from the Firm’s extensive and diverse Energy Practice and our Business Restructuring/Bankruptcy Practice, with several of our lawyers focusing primarily on energy bankruptcies. We are business focused and can make the greatest contribution as an integrated part of the client’s team.
Our ERCR team has provided bankruptcy-related legal counsel to non-bankrupt power marketers, energy trading companies, electric cooperatives, investor-owned utilities, and industrial end users, as well as to several European and British energy companies – handling all aspects of the clients’ needs. We also have represented debtors in possession as special energy counsel, working closely with traditional bankruptcy counsel and restructuring consultants, to provide specialized advice regarding energy contracts, trading, forward contracts, swaps, and regulatory matters. Our team currently serves as special energy counsel to the estate of a major energy trading company.
We are experienced in applying bankruptcy law and principles to forward contracts, swap agreements, netting agreements, futures contracts, options, and tolling agreements – areas in which few bankruptcy firms have in-depth expertise. The ERCR team provides advice relating to procedures for properly terminating and valuing trading contracts and portfolios, negotiating to liquidate positions consensually, responding to counterparty defaults or terminations, drafting master agreements to provide additional protections against counterparty credit risk, developing strategies for responding to margin/collateral calls and demands for adequate assurance, and helping to set priorities and protocols for responding to counterparties, upon bankruptcy. In this context, we have dealt with contracts for power, natural gas, coal, capacity, emissions and environmental attributes.
Our team counsels clients on a host of intersecting bankruptcy, commodity, trading, and regulatory issues, and has represented clients in major proceedings before bankruptcy courts, in adversary proceedings, in mediations and arbitrations, in party negotiations, and before federal agencies, including the Federal Energy Regulatory Commission and Commodity Futures Trading Commission.
We have counseled clients on a number of important energy bankruptcy issues, including:
- Enforceability of limited two-way/one-way termination provisions;
- Procedures for terminating and liquidating forward physical and financial positions and tolling agreements;
- Valuation of physical natural gas and power positions, tolling agreements and financial swaps, derivatives and options;
- Determining whether specific contracts qualify as forward contracts;
- Determining whether counterparties qualify as forward contract merchants;
- Automatic stay, preferences, and fraudulent conveyance issues;
- Enforceability of setoff and netting issues; and
- Credit support, collateral, and guarantee issues.
Our ERCR team has been extensively involved in the following areas:
- Creditors’ Rights
- Restructuring And Bankruptcies
- Dispute Resolution
- Commercial And Contracting Issues
- Federal Regulatory Matters
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