Bankruptcy Judge Harlin D. Hale yesterday refused to enforce Mexican glass maker Vitro SAB's controversial debt restructuring in a closely watched chapter 15 case that threatened to sever the cross-border business cooperation between the two nation's legal systems, the Wall Street Journal reported today. Judge Hale sided with bondholders in rejecting Vitro's bid, saying that Vitro's Mexican restructuring plan, which extinguishes guarantee claims of the U.S. bondholders, "manifestly contravenes the public policy of the United States and is also precluded from enforcement under...the Bankruptcy Code." Vitro thinks Judge Hale's ruling concerning the third-party releases of the guarantees involves a narrow issue of U.S. law and intends to appeal the ruling.
