Opinion ID: 3011898
Heading Depth: 2
Heading Rank: 4

Heading: Duplicate Proceedings

Text: Situations such as this call out for coordination of the two plenary proceedings. The parties have alluded to, and we are aware of, the ability of courts to discuss and ultimately agree upon an amicable resolution of these types of issues by way of an understanding or protocol that becomes a governing instrument by agreement. Maxwell was the poster case for how courts can work together when dual proceedings take place, and other courts have followed suit. E.g., In re Ionica PLC , 241 B.R. 829 (Bankr. S.D.N.Y. 1999); In re Commodore Int’l Ltd., 242 B.R. 243 (Bankr. S.D.N.Y. 1999), aff ’d, 2000 WL 977681 (S.D.N.Y. July 17, 2000). In Maxwell, a protocol was established -- a plan of reorganization and a scheme of arrangement, which are interdependent documents and were filed by the administrators in the United States and English courts respectively -- that was praised as  ‘. . . perhaps the first world-wide plan of orderly liquidation ever achieved’. Maxwell, 93 F.3d at 1042 (quoting Jay Lawrence Westbrook, The Lessons of Maxwell Communication, 64 Fordham L. Rev. 2531, 2535 (1996)). The parties have indicated that such a protocol was attempted but was not achievable in the instant situation, although the record is somewhat sparse on this issue.14 There are references to things done or said by the Belgian court, but no references to any specific attempt-- by the parties or by the Bankruptcy Court -- to bridge the gap between them. Instead, counsel complains that the debtor faces an impossible situation -- that we must suggest is of the debtor’s own making -- while the Bankruptcy Court assumed at one point that the Catch-22 will be worked out through negotiation, and indicated that such coordination should be initiated by the debtor. We strongly recommend, in a situation such as this, that an actual dialog occur or be attempted between the courts of the different jurisdictions in an effort to reach an _________________________________________________________________ 14. Our request that the parties supplement the briefing on this issue resulted only in citations to comments by counsel at various oral arguments and to the plan L&H had submitted to the Belgian court, which purportedly included a protocol-like provision. 21 agreement as to how to proceed or, at the very least, an understanding as to the policy considerations underpinning salient aspects of the foreign laws. Maxwell provides a good example. There, the Court of Appeals for the Second Circuit attributed the high level of international cooperation and a significant degree of harmonization of the laws of the two countries in large part to the cooperation between the two courts overseeing the dual proceedings. Maxwell, 93 F.3d at 1053. While we do not know whether the cooperation there was initiated by the court or the parties, there is no reason that a court cannot do so, especially if the parties (whose incentives for doing so may not necessarily be as great) have not been able to make progress on their own. See generally BUFFORD, SAMUEL L., ET AL., INTERNATIONAL INSOLVENCY 93 (Federal Judicial Center 2001) (recommending that judges communicate with each other in transnational cases). In Maxwell, the court suggested thatbankruptcy courts may best be able to effectuate the purposes of the bankruptcy law by cooperating with foreign courts on a case-by-case basis. Id. Even if cooperation could not be achieved, it would be valuable to communicate regarding the policies animating a certain law so as to be better able to perform a choice-of-law analysis. While not required by our case precedent or any principle of law, we urge that, in a situation such as this, communication from one court to the other regarding cooperation or the drafting of a protocol could be advantageous to the orderly administration of justice.