Ropes & Gray Attorneys Discuss Wesco Case in Harvard Law School Bankruptcy Roundtable

In an article on Harvard Law School Bankruptcy Roundtable, business restructuring partner Ryan Dahl, capital solutions & private credit partner Leonard Klingbaum, business restructuring counsel Stephen Iacovo and associate Tessa Ptucha discussed the summary judgement opinion in the chapter 11 case of Wesco Aircraft Holdings, Inc.

The article says, “the ruling may be read to (explicitly or not) accept the notion that ‘implied sacred rights’ may be read into credit documents to thwart what are otherwise commonplace aspects of credit documentation.  At issue in the decision was Wesco’s 2022 uptier transaction, which, through a series of related transactions, permitted certain participating noteholders to exchange their existing notes into new notes with senior priority liens on a non-pro rata basis despite the indentures’ pro rata redemption requirement.”

For more on the ruling, please see this alert.