Bradley, in the matter of Astora Women's Health, LLC v Astora Women's Health, LLC

Federal Court of Australia|2022-09-28|Before: Halley J

Pursuant to Art 19(1)(a) of the Model Law on Cross-Border Insolvency of the United Nations Commission on International Trade Law (Model Law), that until the application for relief under Art 17 of the Model Law made in the originating process in this proceeding is decided, or until further order of the Court: (a) any and all execution against the assets of the Defendant, Astora Women's Health, LLC (Astora LLC) be stayed; (b) no person within the jurisdiction of the Court other than Astora LLC may transfer, encumber or otherwise dispose of, or take possession of or otherwise recover, any assets of Astora LLC; (c) subject to order 2, no proceeding against Astora LLC, or in relation to any of its property, may be begun or proceeded with except: (i) with the Plaintiff's written consent; or (ii) with the leave of the Court and in accordance with such terms (if any) as the Court imposes; (d) no receiver may be appointed to any of the assets of Astora LLC, nor may any step be taken to enforce any security over any of the assets of Astora LLC in Australia.
Order 1(c) does not prevent a person from commencing a proceeding where reasonably necessary to preserve a claim against expiry of a limitation period, provided that such proceeding, once commenced, may not be proceeded with other than in accordance with order 1(c).
The requirements of 15A.3(4)(a) and 15A.6(1) of the Federal Court (Corporations) Rules 2000 (Cth) be dispensed with and in lieu thereof the Plaintiff: (a) within 20 business days of the making of these orders, publish notice in the form appearing in the Schedule to these Orders (Notice) in The Australian and Australian Financial Review newspapers; (b) distribute the Notice as follows: Applicants in Federal Court of Australia Proceeding NSD35 of 2018 (Class Action) (i) within 20 business days of the making of these orders, the Plaintiff give the Notice to the applicants in the Class Action by sending a copy of the Notice to the applicants' solicitors, Shine Lawyers, once by way of email and once by ordinary post; Other known claimants (ii) within 20 business days of the making of these orders, the Plaintiff give the Notice to the individuals referred to as TP, KC and BK in the affidavit sworn by Mark Thomas Bradley in this proceeding on 24 August 2022 (Bradley Affidavit) by sending a copy of the Notice to their solicitors, AJB Stevens Lawyers, once by way of email and once by ordinary post; (iii) within 20 business days of the making of these orders, the Plaintiff give the Notice to the individual identified as Professor AR in the Bradley Affidavit by sending the Notice to that person's solicitors, Moray & Agnew, once by way of email and once by ordinary post.

Introduction 1 On 28 September 2022, I made orders on the application of the plaintiff, Mark Thomas Bradley, in his capacity as the foreign representative (Foreign Representative) of the defendant, Astora Women's Health, LLC (Astora), including an order under s 6 of the Cross-Border Insolvency Act 2008 (Cth) (Act) for interim relief under art 19 of the UNCITRAL Model Law on Cross- Border Insolvency of the United Nations Commission on International Trade Law (Model Law), being sch 1 to the Act, and directions as to the notification of creditors in place of the requirements in r 15A.3(3) of the Federal Court (Corporations) Rules 2000 (Cth) (Rules). 2 Astora is a Delaware limited liability company. It is the subject of a Chapter 11 proceeding Case No. 22-22594 (Astora Chapter 11 Proceeding) filed in the United States Bankruptcy Court for the Southern District of New York (US Bankruptcy Court). 3 The Foreign Representative has been appointed to act as the foreign representative on behalf of Astora's estate in connection with this recognition proceeding. 4 The hearing of the application by the Foreign Representative in this proceeding on 28 September 2022 (interim application) was heard together with an application by Astora in proceeding NSD 35 of 2018 (Class Action Proceeding): see Philipsen v Astora Women's Health, LLC [2022] FCA 1196. On the application of Ms Beechey of counsel, who appeared for the Foreign Representative in these proceedings and for Astora in the Class Action Proceeding, I ordered that evidence in each proceeding be evidence in the other. 5 The only creditors that appeared at the hearing on 28 September 2022 were the class action applicants in the Class Action Proceeding. They did not oppose the making of the orders sought by the Foreign Representative. Late on the evening prior to the hearing, the Court received an email from AJB Stevens Lawyers requesting that the four creditors of Astora for whom they acted be excluded from the orders sought by the Foreign Representative at the hearing of the interim application (AJB Stevens creditors). 6 These are my reasons for making the orders on 28 September 2022.

Evidence 7 The Foreign Representative relied on the following affidavits in support of the interim relief that he sought: (a) his affidavit sworn on 24 August 2022 in which he explained the background to the application; (b) an affidavit of George Panagakis, a member of the Illinois Bar and a partner in the Corporate Restructuring Group of Skadden, Arps, Slate, Meagher & Flom LLP (Skadden Arps), sworn on 24 August 2022, explaining the particular characteristics of proceedings brought under chapter 11 of title 11 of the United States Code (respectively, Chapter 11 and the Bankruptcy Code); (c) an affidavit of David McCredie, a partner of Baker McKenzie, the solicitors for the Foreign Representative and Astora, sworn on 9 September 2022, in which he explains how contact details of Australians who are or who claim to be creditors of Astora were obtained by Astora (Australian Claimant Information), and the use to which Astora seeks to use that information in the Astora Chapter 11 Proceeding and related Chapter 11 proceedings, including those proceedings concerning the ultimate parent company of Astora, Endo International plc; and (d) an affidavit of Evan Hill, sworn on 22 September 2022, a partner of Skadden Arps, in which he provides additional detail on the Chapter 11 proceedings and why additional relief is now sought in the application in the Class Action Proceeding with respect to the use to which Astora seeks to use the Australian Claimant Information in the Astora Chapter 11 Proceeding and the related Endo Chapter 11 proceedings.

Background 8 By his originating process filed 12 September 2022, the Foreign Representative seeks an order by way of final relief that the Astora Chapter 11 Proceeding be recognised as a foreign main proceeding pursuant to art 17 of the Model Law. 9 Astora has no ongoing business operations and no assets. Its operations are limited to defending litigation primarily in the USA but also in certain other jurisdictions including Australia, brought against it by patients that received treatment with implantable surgical mesh products manufactured and distributed by it or its predecessor entities. 10 Astora is part of the Endo group of companies (Endo Group). The parent company of the Endo Group is Endo International plc (Endo plc). Endo plc became an Irish incorporated company in 2014. Astora's liabilities include a guarantee that it has provided USD $8.15 billion of long term debt obligations of Endo plc. 11 On 16 August 2022, Astora, together with Endo plc and 75 other companies in the Endo Group, filed petitions (Endo Group Chapter 11 Proceedings) in the US Bankruptcy Court to commence bankruptcy proceedings under Chapter 11 of the Bankruptcy Code. The Astora Chapter 11 Proceeding is being jointly administered for procedural purposes with the other Endo Group Chapter 11 Proceedings. 12 Mr Bradley gave evidence that the Endo Group Chapter 11 Proceedings were precipitated by first, an adverse litigation outcome relating to one of the Endo Group's highest revenue generating products, second, slower than expected growth in certain other products, and third, litigation overhang from thousands of lawsuits related to the sale and manufacture of opioids. Neither Astora nor any of its predecessors were involved in the manufacture or sale of opioid products, and Astora is not subject to any litigation in relation to such products. 13 Although the Astora Chapter 11 Proceeding has been filed in a coordinated process with the other Endo Group Chapter 11 Proceedings, and the US Bankruptcy Court has ordered that all of the Endo Group Chapter 11 Proceedings be administered jointly, and the proceedings have not been substantively consolidated.

Legal Principles 14 Section 6 of the Act provides that the Model Law, with the modifications set out in Part 2 of the Act, has the force of law in Australia. 15 Article 17 of the Model Law relevantly provides: Article 17 Decision to recognize a foreign proceeding 1. Subject to article 6, a foreign proceeding shall be recognized if: (a) The foreign proceeding is a proceeding within the meaning of subparagraph (a) of article 2; (b) The foreign representative applying for recognition is a person or body within the meaning of subparagraph (d) of article 2; (c) The application meets the requirements of paragraph 2 of article 15; and (d) The application has been submitted to the court referred to in article 4. 2. The foreign proceeding shall be recognized: (a) As a foreign main proceeding if it is taking place in the State where the debtor has the centre of its main interests; or … 3. An application for recognition of a foreign proceeding shall be decided upon at the earliest possible time. 16 Article 17 in turn directs attention to arts 2, 4, 6 and 15 of the Model Law. 17 Article 2 of the Model Law provides that: Article 2 Definitions For the purposes of the present Law: (a) "Foreign proceeding" means a collective judicial or administrative proceeding in a foreign State, including an interim proceeding, pursuant to a law relating to insolvency in which proceeding the assets and affairs of the debtor are subject to control or supervision by a foreign court, for the purpose of reorganization or liquidation; (b) "Foreign main proceeding" means a foreign proceeding taking place in the State where the debtor has the centre of its main interests; … (d) "Foreign representative" means a person or body, including one appointed on an interim basis, authorized in a foreign proceeding to administer the reorganization or the liquidation of the debtor's assets or affairs or to act as a representative of the foreign proceeding; (e) "Foreign court" means a judicial or other authority competent to control or supervise a foreign proceeding; 18 Article 4 of the Model Law provides for a specification of the court, courts, authority or authorities competent to perform the functions in the Model Law relating to the recognition of foreign proceedings and cooperation with foreign courts. 19 Section 10 of the Act provides that for the purposes of art 4 of the Model Law this Court is competent to perform the functions in the Model Law relating to the recognition of foreign proceedings and cooperation with foreign courts for both individuals (s 10(a)) and debtors other than individuals (s 10(b)(i)). 20 Article 6 of the Model Law provides that the Court may refuse to take any action under the Model Law if the action would be manifestly contrary to the public policy of Australia. 21 Article 15 of the Model Law relevantly provides: Article 15 Application for recognition of a foreign proceeding 1. A foreign representative may apply to the court for recognition of the foreign proceeding in which the foreign representative has been appointed. 2. An application for recognition shall be accompanied by: (a) A certified copy of the decision commencing the foreign proceeding and appointing the foreign representative; or (b) A certificate from the foreign court affirming the existence of the foreign proceeding and of the appointment of the foreign representative; or (c) In the absence of evidence referred to in subparagraphs (a) and (b), any other evidence acceptable to the court of the existence of the foreign proceeding and of the appointment of the foreign representative. 3. An application for recognition shall also be accompanied by a statement identifying all foreign proceedings in respect of the debtor that are known to the foreign representative. 22 Article 16(3) of the Model Law provides that in the absence of proof to the contrary, a company's "centre of its main interests" (COMI) is presumed to be in the State in which its registered office is located. 23 A rebuttal of the presumption for which art 16(3) provides requires factors which are both objective and ascertainable by third parties, including creditors: see Kapila, in the matter of Edelsten (2014) 320 ALR 506; [2014] FCA 1112 (Kapila) at [54] (Beach J); UNCITRAL Guide to Enactment and Interpretation (UNCITRAL, 2014) at [145]-[147]. 24 To rebut the presumption, those factors must warrant a conclusion that an actual situation exists which is different from that which locating it at the registered office is deemed to reflect: Wood v Astra Resources Ltd (UK Company No 07620218) [2016] FCA 1192 at [14] (White J). 25 Section 13 of the Act modifies art 15 of the Model Law. It requires that the application must also be accompanied by a statement identifying, relevantly, any appointment of a receiver within the meaning of s 416 of the Corporations Act 2001 (Cth) (Corporations Act) and all proceedings under Chapter 5, s 601CL and Sch 2 to the Corporations Act that are known to the foreign representative.

Consideration 26 Whether the interim relief sought should be granted turned on first, the strength of the Foreign Representative's case for recognition of the Astora Chapter 11 Proceeding as a foreign main proceeding and the relief likely to be granted at the hearing, and second, whether the interim relief is urgently needed to protect the assets of the debtor or the interests of the creditors. 27 In order to establish that the Astora Chapter 11 Proceeding should be recognised as a foreign main proceeding under the Model Law, it will be necessary for the Foreign Representative at the final hearing to satisfy the requirements of arts 17 and 15 of the Model Law (as modified by s 13 of the Act) and Div 15A of the Rules. 28 I address each of those requirements below.

Article 17 requirements 29 As to art 17(1)(a), I was satisfied for the purposes of the interim application that the evidence of Mr Panagakis established that a Chapter 11 proceeding is a foreign proceeding for the purposes of art 2 of the Model Law for the following reasons: (a) it is a judicial proceeding: it is in all respects subject to the supervision of the US Bankruptcy Court; (b) it is a collective proceeding: the purpose of Chapter 11 is to restructure a debtor's liabilities for the benefit of its creditors as a whole and all creditors are entitled to participate in the restructuring process; (c) it is a proceeding in a foreign state: the United States; (d) it is conducted pursuant to a law relating to insolvency: Chapter 11 of the Bankruptcy Code; (e) the assets and affairs of a debtor during the proceeding are subject to control or supervision by a foreign court: actions outside the ordinary course, including disposition of property, may only take place with the approval of the US Bankruptcy Court and the Court may make orders regarding the debtor's use of secured property, including cash collateral, and protections to be provided to secured creditors in respect of such use; and (f) the proceeding is for the purpose of a reorganisation or liquidation of a debtor: the purpose of a Chapter 11 proceeding is to provide for a restructure of a debtor's liabilities through a "Plan of Reorganisation" which will become binding upon confirmation by the US Bankruptcy Court. 30 Moreover, this Court has previously recognised that Chapter 11 proceedings satisfy the requirements of art 17 of the Model Law: see Young, Jr, in the matter of Buccaneer Energy Limited v Buccaneer Energy Limited [2014] FCA 711 (Jagot J); Kapila at [32]; Moore, as Debtor-in-Possession of Australian Equity Investors v Australian Equity Investors [2012] FCA 1002 at [12] (Emmett J). 31 As to art 17(1)(b), I was satisfied that the Foreign Representative has been specifically appointed by the US Bankruptcy Court to act as a representative of Astora's estate for the purposes of this recognition proceeding under the Model Law and therefore he comes within the definition of a "foreign representative" in art 2(d). 32 As to art 17(1)(c), I was satisfied that the Foreign Representative has been expressly authorised by the US Bankruptcy Court to act as a foreign representative for the Astora Chapter 11 Proceeding. 33 As to art 17(1)(d), I was satisfied that this Court, by reason of s 10(b)(i) of the Act, is a Court for the purposes of art 4 of the Model Law for the Astora Chapter 11 Proceeding.

Article 15(3) requirements as modified by s 13 34 I was satisfied for the purposes of the interim application that the art 15(3) requirement, as modified by s 13 of the Act, had been established. The Foreign Representative included in his affidavit an explanation of all foreign proceedings in respect of Astora of which he was aware, including in Australia, and expressly confirmed that he was not aware of any current proceedings in Australia involving Astora under the Corporations Act, the Bankruptcy Act 1966 (Cth), any appointment of a receiver or a controller over the property of Astora or any proceeding under Chapter 5, s 601CL or Schedule 2 of the Corporations Act with respect to Astora.

Recognition as a foreign main proceeding 35 Astora's registered office is located at 1209 Orange Street, Wilmington, Delaware 19801, USA. In the present case, there was nothing to displace the presumption. 36 The Foreign Representative submitted, and I accepted, that the following factors of which Mr Bradley gave evidence reinforced the conclusion that the COMI of Astora is in the USA: (a) in accordance with Delaware law and a written agreement, Astora is managed by its sole member (Endo Pharmaceuticals Inc) and officers appointed to Astora by the sole member; (b) each of the seven appointed officers of Astora is based in Pennsylvania, USA; (c) Endo Pharmaceuticals Inc is a Delaware incorporated entity with the same Delaware registered office as Astora, and its two directors are both based in Pennsylvania, USA; (d) Astora does not have business premises, staff or any business operations outside of the USA; (e) Astora is not and has never been managed from the head office of the Endo Group in Ireland; and (f) Astora's only business is defending litigation, which is conducted from its registered office in Delaware.

Form of the art 20 stay 37 Article 20 of the Model Law is subject to s 16 of the Act, which provides: For the purposes of paragraph 2 of Article 20 of the Model Law (as it has the force of law in Australia), the scope and the modification or termination of the stay or suspension referred to in paragraph 1 of that Article, are the same as would apply if the stay or suspension arose under: (a) the Bankruptcy Act 1966; or (b) Chapter 5 (other than Parts 5.2 and 5.4A) of the Corporations Act 2001; as the case requires. 38 As Jagot J observed in Tai-Soo Suk v Hanjin Shipping Co Ltd [2016] FCA 1404 (Tai-Soo Suk) at [20], Chapter 5 of the Corporations Act relevantly includes: (a) Part 5.1 (scheme of arrangement); (b) Part 5.3A (voluntary administration); (c) Part 5.4/Part 5.4B (Court-ordered liquidation); and (d) Part 5.5 (voluntary liquidation). 39 Each Part identified above, other than Part 5.1, has specific provisions for stays. 40 Chapter 11 of the Bankruptcy Code establishes a regime for business reorganisations. Mr Panagakis gave the following evidence, which I accepted given his experience as a corporate restructuring attorney with Skadden Arps. First, that following the commencement of a Chapter 11 proceeding, the existing management of the debtor remains in place and, unless the Court orders otherwise, they may continue to operate the business in the ordinary course. Second, an automatic stay on enforcement actions against the debtor applies upon commencement of the case, and may be enforced, varied or lifted by order of the US Bankruptcy Court. Third, the stay is intended to operate extraterritorially. Fourth, a restructuring of the debtor's liabilities can be implemented through a "Plan of Reorganisation" that is voted on by the creditors, and will become binding upon confirmation by the US Bankruptcy Court if the relevant statutory requirements have been satisfied, including those relating to creditor approval and protection. 41 As a debtor-in-possession regime, Chapter 11 does not have a precise analogue in Australian law. I was satisfied, however, for the purposes of determining the interim application that the automatic stay in s 362 of the Bankruptcy Code is similar to the Australian voluntary administration stay, affecting both unsecured and secured creditors. 42 I was also satisfied that a proceeding under Chapter 11 is most closely analogous to an Australian voluntary administration and thus the stay that would apply by Model Law art 20 if the recognition application is ultimately successful would be in substance the same as that created under Part 5.3A of the Corporations Act: see similarly Tai-Soo Suk at [51] (Jagot J); Senvion GmbH, in the matter of Senvion GmbH (No 2) (2019) 140 ACSR 20; [2019] FCA 1732 at [23] (Anastassiou J).

Conclusion as to likelihood of recognition 43 Article 17(1) provides that a foreign proceeding must be recognised (subject to art 6) if all the requirements of art 17(1) are satisfied. 44 I was satisfied that art 6 is unlikely to preclude the recognition of the Astora Chapter 11 Proceeding as a foreign main proceeding. I see no basis on which it could be contended that the formal restructuring process provided for the benefit of all creditors pursuant to Chapter 11 is manifestly contrary to the public policy of Australia. Although there is no identical procedure available under Australian insolvency law, as I explain above it has many of the characteristics of the voluntary administration procedure under the Corporations Act. 45 For the reasons outlined above, I was satisfied that the Foreign Representative has established a strong case for recognition of the Astora Chapter 11 Proceeding as a foreign main proceeding under the Model Law.

Interim relief 46 Article 19 of the Model Law relevantly provides: Article 19 Relief that may be granted upon application for recognition of a foreign proceeding 1. From the time of filing an application for recognition until the application is decided upon, the court may, at the request of the foreign representative, where relief is urgently needed to protect the assets of the debtor or the interests of the creditors, grant relief of a provisional nature, including: (a) Staying execution against the debtor's assets; (b) Entrusting the administration or realization of all or part of the debtor's assets located in this State to the foreign representative or another person designated by the court, in order to protect and preserve the value of assets that, by their nature or because of other circumstances, are perishable, susceptible to devaluation or otherwise in jeopardy; (c) Any relief mentioned in paragraph 1 (c), (d) and (g) of article 21 below. … 4. The court may refuse to grant relief under the present article if such relief would interfere with the administration of a foreign main proceeding. 47 The Foreign Representative seeks interim relief pursuant to art 19(1)(a) of the Model Law in the following terms: until the application for relief under art 17 of the Model Law made in the originating process in this proceeding is decided, or until further order of the Court: (a) any and all execution against the assets of the Defendant, Astora Women's Health, LLC (Astora LLC) be stayed; (b) no person within the jurisdiction of the Court other than Astora LLC may transfer, encumber or otherwise dispose of, or take possession of or otherwise recover, any assets of Astora LLC; (c) no proceeding against Astora LLC, or in relation to any of its property, may be begun or proceeded with; (d) no receiver may be appointed to any of the assets of Astora LLC, nor may any step be taken to enforce any security over any of the assets of Astora LLC in Australia. 48 Relief has previously been granted by this Court under art 19: see Tucker, in the matter of Aero Inventory (UK) Limited v Aero Inventory (UK) Limited (2009) 76 ACSR 19; [2009] FCA 1354 (Lindgren J); Hur v Samsun Logix Corporation [2009] FCA 372 at [4] (Jacobson J); Asafuji (in his capacity as the Foreign Representative of the Sanko Steamship Co., Ltd) v The Sanko Steamship Co., Ltd [2012] FCA 1154 (Bromberg J). 49 The Foreign Representative submits that the interim relief is appropriate for the following reasons: (a) Astora is the defendant in an ongoing class action in this Court; (b) Astora is also aware of other persons who may seek to pursue pelvic mesh claims against it in Australia, but who have not yet commenced such claims; (c) recognition is likely to be granted at the final hearing. The effect of recognition will be a stay of proceedings, most likely of the kind imposed by Part 5.3A of the Corporations Act. Generally speaking, such a stay would prevent the commencement or continuation of proceedings and enforcement action without leave of the Court; (d) the interim relief is directed to achieving on an interim basis, the ultimate purpose of the recognition application, being, as stated by the Foreign Representative: to implement a stay of on-going litigation in Australia, with the intention that the plaintiffs in such cases can file claims in Astora's bankruptcy instead of continuing with ongoing litigation. In essence, the purpose of the recognition is to stay those proceedings, which would be more expensive and burdensome for Astora's bankruptcy estate than the filing and handling of those claims as claims in the bankruptcy, and therefore would ultimately reduce the assets available to meet those claims … (e) Astora's attention and resources should not be diverted away from attempting to achieve a restructuring plan by ongoing or new litigation in Australia in the period prior to the recognition hearing; (f) the recognition hearing is likely to occur within a relatively short time; (g) the stays sought are interim stays and are unlikely to cause prejudice to the creditors. In particular, the interim stays are unlikely to cause prejudice to the plaintiff or the class members in the class action, or to potential claimants in pelvic mesh proceedings yet to be commenced; and (h) the order sought that any party affected by the orders have liberty to apply on five business days' notice further diminishes the likelihood of any ongoing prejudice to creditors. 50 I accepted, for the reasons advanced by the Foreign Representative, that there was a material risk that the assets of Astora might be diminished and the interests of the creditors of Astora might be prejudiced if a stay were not granted in the period prior to the recognition hearing. Further, as I stated above, the case for recognition of the Astora Chapter 11 Proceeding at the recognition hearing was strong. 51 In order to minimise the risk of any inadvertent prejudice to creditors, I concluded that it was necessary to also make an order that the interim stay sought by the Foreign Representative would not preclude a person from commencing a proceeding where to do so was reasonably necessary to preserve a claim against expiry of a limitation period. 52 I was otherwise satisfied that the interests of the AJB Stevens creditors were protected by giving any persons affected by the orders made on 28 September 2022 liberty to apply on five business days' notice. I therefore concluded that it was not necessary to make any order at this stage excluding the AJB Stevens creditors from the interim relief sought by the Foreign Representative.

Directions as to service of originating process, notification and publication 53 Rule 15A.3(3) of the Corporations Rules provides that an application for recognition must be accompanied by an interlocutory process seeking directions from the Court as to service. The Court may make any order as to, or ancillary to, service that it sees fit. 54 Rule 15A.3(4) provides that, unless the Court orders otherwise, the originating process is to be served on each defendant. 55 On 12 September 2022, the originating process was served on Astora. 56 Pursuant to r 15A.6(1) of the Corporations Rules, the Foreign Representative is required to send a notice of the filing of an application for recognition (in accordance with Form 20) to each person whose claim to be a creditor is known to the Foreign Representative, and to publish the same notice in a daily newspaper circulating generally in the State or Territory where the body has its principal, or last known, place of business. 57 The alternative orders sought by the Foreign Representative were in the following form: that the requirements of rr 15A.3(4)(a) and 15A.6(1) be dispensed with and in lieu thereof the Plaintiff: (a) within 20 business days of the making of these orders, publish notice in the form appearing in the Schedule to these Orders (Notice) in The Australian and Australian Financial Review newspapers; (b) distribute the Notice as follows: Applicants in Federal Court of Australia Proceeding NSD35 of 2018 (Class Action) (i) within 20 business days of the making of these orders, the Plaintiff give the Notice to the applicants in the Class Action by sending a copy of the Notice to the applicants' solicitors, Shine Lawyers, once by way of email and once by ordinary post; Other known claimants (ii) within 20 business days of the making of these orders, the Plaintiff give the Notice to the individuals referred to as TP, KC and BK in the affidavit sworn by Mark Thomas Bradley in this proceeding on 24 August 2022 (Bradley Affidavit) by sending a copy of the Notice to their solicitors, AJB Stevens Lawyers, once by way of email and once by ordinary post; (iii) within 20 business days of the making of these orders, the Plaintiff give the Notice to the individual identified as Professor AR in the Bradley Affidavit by sending the Notice to that person's solicitors, Moray & Agnew, once by way of email and once by ordinary post. 58 The Foreign Representative submits that these orders are an appropriate replacement for the notification regime in r 15A.6(1) for the following reasons: (a) creditors will be given notice of the Astora Chapter 11 Proceeding in due course, subject to any orders of this Court made on the interim application; (b) given the narrow purpose of the Australian recognition application, there is a real prospect that any attempt to notify creditors more widely, and in particular, any attempt to notify all of the registered class members, would cause confusion for creditors, who may not understand that they do not need to take steps in relation to the Australian recognition proceeding in order to exercise their rights in the Astora Chapter 11 Proceeding; (c) creditors who wish to pursue action in Australia despite the recognition and accompanying stay will be able to approach the Court for leave to proceed against Astora; and (d) the order sought on both the interim recognition application and the final recognition application granting liberty to apply to any person affected by the orders should indicate to creditors who become aware of the Australian recognition orders that they have a right to approach the Court despite the stay. 59 The effect of the alternative notification orders sought by the Foreign Representative is that, rather than being served with separate Form 20 and Form 21 notices, the known creditors of Astora will receive, within 20 business days of the making of the interim orders, a notification, being a document that combines in a single document the information required to be included in Forms 20 and 21 of the Rules. Form 20 is a notice of an application for recognition of a foreign proceeding and Form 21 is a notice of the making of an order under the Act. 60 In addition to the information required to be included in those forms, it is proposed that an additional note to this effect is to be included: PLEASE NOTE: You should only file an appearance in this proceeding or contact Baker McKenzie if you have any queries about, or want to be heard in relation to, the specific issue of the recognition pursuant to the Act in Australia being sought of the US Proceeding relating to Astora LLC. You do not need to otherwise progress any claim you may have against Astora LLC in this proceeding or in communication with Baker McKenzie. If you have questions about the US Proceeding please contact Astora LLC's Claims and Noticing Agent, Kroll Restructuring Administration LLC, at +1 (929) 284-1688, or by email at endoinquiries@ra.kroll.com. You may also find more information at https://restructuring.ra.kroll.com/Endo. [Emphasis in original.] 61 I was satisfied, given the form of the interim and final relief sought by the Foreign Representative, that the proposed composite notice, together with the additional note reproduced above, was an appropriate alternative to the notification procedures stipulated in rr 15A.3(4)(a) and 15A.6(1). It provided in a single document a consolidated summary of the information required to be provided to creditors with respect to two interrelated matters, the filing of an application for recognition of a foreign proceeding and the making of an interim order under the Act. I was satisfied that a single document was likely to give rise to less potential confusion and uncertainty than two separate documents and the additional note would assist in making clear to creditors that this proceeding was concerned with the recognition of the foreign Astora Chapter 11 Proceeding rather than progressing their claims by lodging proofs of debt or taking other action to recover the amounts that they contend are owed to them.

Disposition 62 It was for these reasons that I made the interim orders on 28 September 2022. I certify that the preceding sixty-two (62) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Halley.

Corporations Act, the Bankruptcy Act 1966(Cth)

At a glance

Court

Decision date

Before

Source

Judgment (14 paragraphs)

Parties

Legislation Cited (4)

Cases Cited (11)

Cited By (3)