A lawyer for Frontera Holdings LLC, the owner of a natural gas plant near the U.S.-Mexico border, told a judge on Tuesday that it could face fines in Mexico after it was unable to provide electricity for several days due to the brutal winter storm that hit Texas, but that it intends to proceed with its proposed restructuring as planned, Reuters reported. Frontera attorney Matthew Fagen of Kirkland & Ellis told U.S. Bankruptcy Judge Marvin Isgur in Houston during a remote hearing that Frontera, which is the only U.S.-based natural gas operator that exports electricity exclusively to Mexico, could not provide the electricity it is required to deliver because the frigid weather “eviscerated” gas supply. Though the company does not know yet whether it will face any penalties as a result, its plan to exit bankruptcy in the spring remains intact, Fagen said.
Even though the debtor was no longer in business, a Medicaid fraud suit was not subject to the automatic stay and thus served as a deterrent to others.
A federal judge ordered that Venezuela’s stake in oil refiner Citgo Petroleum Corp. be put up for sale to satisfy creditors, calling the country’s nonpayment an affront while acknowledging that no auction can occur under current U.S. sanctions, the Wall Street Journal reported. Judge Leonard Stark of the U.S. District Court in Wilmington, Del., said that Venezuela’s shares in Citgo’s parent company should be positioned for sale “to the extent possible.” No such sale can occur under rules promulgated by the Trump administration that restrict transfers of Venezuelan state property. Judge Stark nonetheless said that he would appoint a special master to map out a sale process, granting a request by Crystallex International Corp., a defunct Canadian mining enterprise that partnered with Venezuela on a gold project that was nationalized in 2011. Crystallex went bankrupt as a result and has been trying to collect its lost investment from Venezuela ever since, targeting Citgo. Other Venezuela creditors owed large debts are also circling the oil company. Judge Stark said that each day Crystallex’s roughly $1 billion judgment goes unpaid is “arguably something of an affront” to the U.S. judicial system. The judge also laid out a rough framework for auctioning Venezuela’s shares of Citgo parent PDV Holding Inc. to the highest bidder, including a requirement that financial disclosures about the asset be made available to serious bidders. Crystallex has applied with the U.S. Treasury Department for a license that would allow the shares to be sold, according to court papers. A decision on the license application likely falls to the incoming Biden administration.
Justices rule that affirmative action is required before withholding property amounts to controlling estate property and results in an automatic stay violation.
For 40 years, the legacy of Proposition 13, a landmark California law that limits property tax increases, has shaped state politics. The measure weathered various legislative and legal challenges, including a trip to the Supreme Court, and came to be considered untouchable. Now the law has survived perhaps its biggest test after California voters rejected a ballot initiative that would have undone a portion of Proposition 13, The New York Times reported. The new law, Proposition 15, would have removed commercial properties like office buildings and industrial parks from Proposition 13’s limits, and it would have given labor and progressive groups a long-sought victory to increase funding for education and local services. The Associated Press called the result of the Nov. 3 vote on the measure on Tuesday night, when the count was 51.8 percent to 48.2 percent against it. “This is an important moment in California political history — the biggest attempt to reform Proposition 13,” said Manuel Pastor, an author and sociology professor at the University of Southern California. “Given that this is the third rail of California politics, it actually came pretty close with very significant headwinds including a recession, and the limits the pandemic placed on door-knocking and other high-touch voter contact.” Proposition 15 would have raised $6.5 billion to $11.5 billion a year for public schools, community colleges and city and county governments, according to a nonpartisan state agency. Proponents had promoted the measure as a needed investment in public services when the economy and budgets are under stress. The measure had won prominent endorsements. Opponents, including business associations and large property owners, said the measure would hurt small businesses and open the door to raising taxes on residential properties as well.
