Bankruptcy, Foreign Bankruptcy, Effect Of Reversed Order Denying Stay, 11 USC 1520, 2, 9
A foreign corporation that is undergoing bankruptcy proceedings in the foreign country of its origin may file a petition in US bankruptcy courts. If the petition is granted, actions against the foreign corporation or its property are automatically stayed. 15 USC 1520. Black Gold filed such a petition, but the bankruptcy court denied it. The BAP eventually reversed the denial. This decision holds that the automatic stay does not apply retroactively to void proceedings that took place between the bankruptcy court’s denial of Black Gold’s petition and the BAP’s reversal. And, once in effect, the automatic stay did not prevent plaintiff from pursuing Black Gold’s principals on an alter ego theory.