June 5, 2009 2:30 PM

Canadian Lawyers on North America's Biggest Bankruptcies

Posted by Julie Triedman

Like their U.S. counterparts, insolvency and restructuring lawyers at Canada's largest firms have been working around the clock since the winter to keep up with the avalanche of major bankruptcy filings to hit Canadian courts. At least a dozen large Canadian bankruptcies have been filed so far this year under the Companies' Creditors Arrangement Act (CCAA), Canada's significantly streamlined version of Chapter 11. In many cases, Canadian lawyers are also serving as Canadian counsel to companies that have filed parallel U.S. bankruptcy court petitions.

Chrysler LLC and General Motors: Chrysler and GM are being handled under U.S. Chapter 11 bankruptcy proceedings, but their Canadian counsel have been busy advising parties to the relevant Canadian government-backed loan agreements, as well as participating in negotiations between the companies' Canadian subsidiaries and creditors.

Osler, Hoskin & Harcourt's Lyndon Barnes and Tracy Sandler have been tapped by General Motors Canada in the effort to restructure the Canadian unit outside of the CCAA process. As a failsafe, says The Financial Post, Osler's Heather McKean and Steven Golick did the groundwork on a potential CCAA plan.

Terrence O'Sullivan, of Lax O'Sullivan Scott, is acting for GM Canada's board; Goodmans' Gale Rubenstein and Robert Chadwick are acting for the Ontario government for both auto companies' overall restructuring, as well as in connection with their Chapter 11 filings and in their roles as lenders in Canada. Chadwick is also working on the GM side along with Brian Empey. 

McCarthy Tetrault's James Gage and Ryan Stabile are acting for Chrysler Canada Inc. on the Chapter 11 filing. Richard Higa and Robert Stephenson are representing the company in connection with funding provided by Export Development Canada (EDC).

EDC, for its part, has tapped Andrew Kent, Max Mendelsohn, Peter Willis, and Judie Jokinen of McMillan. The Canadian government, meanwhile, has retained a team including Michael Weinczok, Bruce Leonard, Marc Mercier, and Ken Snider of Cassels Brock & Blackwell to work on both the GM and Chrysler restructurings.

Blake, Cassels & Graydon fielded a team led by Jeff Galway, Pamela Huff, and Nathan Cheifetz for a group of GM Canada bondholders. McCarthys' Kevin McElcheran is also representing a Canadian bondholder, Appaloosa Management, in the process of settling with GM Canada.

Torys's Tony DeMarinis, Scott Bomhof, and Adam Delean are acting for GMAC and its Canadian affiliate on the GM restructuring.

CanWest Global Communications Corp.: Winnipeg, Manitoba-based CanWest, Canada's largest media company, has been in negotiations with banks and bondholders in an effort to restructure its debt and avoid bankruptcy. On May 29 it missed a $10 million interest payment, complicating that effort.

Goodmans' Carfagnini and Chadwick are advising senior lenders on recapitalization efforts. McCarthys' Garth Girvan, Kevin McElcheran, Heather Meredith, Grant Buchanan, and Malcolm Mercer are acting for Goldman Sachs Capital Partners, a major stakeholder.

Nortel Networks Corporation: The Ottawa-based telecom equipment maker filed for bankruptcy in the U.S. and in Canada in January. On Tuesday, it sought a three-month extension of protection against creditors to whom it owes billions of dollars.

Ogilvy Renault's Derrick Tay and a team from Cleary, Gottlieb, Steen & Hamilton are representing Nortel. Osler's Jean Fraser, Brian Levitt, Edward Sellers, and Lyndon Barnes are advising the board.

Goodmans' Carfagnini, along with Joseph Pasquariello, are acting for the monitor, Ernst & Young, in connection with both the company's CCAA and Chapter 11 proceedings. Bruce Leonard and Harvey Garman of Cassels Brock are representing the UK Pension Protection Fund, one of the largest creditors in the CCAA claim. Fraser Milner Casgrain's R. Shayne Kukulowicz, Alex MacFarlane, and Michael Wunder are acting as Canadian counsel to the official unsecured creditors' committee. McCarthys is representing a number of possible buyers of assets. And Faskin Martineau DuMoulin's Donald Milner is representing Export Development Canada.

AbitibiBowater: North America's largest newsprint maker, which filed for bankruptcy protection in April, won court approval for as much as $600 million in debtor-in-possession (DIP) financing in U.S. bankruptcy court in Wilmington, Del., on Thursday. The Montreal-based company has also filed for protection from its Canadian creditors, with the judge in that filing approving a $100 million DIP loan on May 6.

Stikeman Elliott is acting for AbitibiBowater in its CCAA filing; the team includes Sean Dunphy, Marc Barbeau, and Howard Rosenoff. McCarthys is acting for the Bank of Nova Scotia, as the agent for the senior secured facility. Borden Ladner Gervais is representing the ad hoc committee of secured creditors. Goodmans' Chadwick is acting for the ad hoc committee of bondholders. And Torys' Michael Rotsztain and David Chaikof are acting for Toronto-based Fairfax Financial Holdings Ltd., a DIP lender and major creditor. 

Quebecor World Inc.: The Montreal-based communications and printing company filed for bankruptcy protection in January. The company said in April that it expected to exit bankruptcy in mid-June, but a buyout offer by Chicago-based RR Donnelley & Sons Co. could alter those plans.

Ogilvy's Tay, Louis Gouin, and Sylvain Rigaud are acting for Quebecor in its CCAA filing. Davies Ward Phillips & Vineberg is representing the monitor. Goodmans' Carfagnini and Pasquariello are representing the ad hoc committee of bondholders. McCarthys' Higa, McElcheran, Joel Scoler, and Gregory Walters are acting for GE Capital, one of the company's DIP lenders and its collateral agent; Blakes' Huff, Linc Rogers, Yannick Beaudoin and Sebastien Guy are acting for another group of DIP lenders.

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