Vitro SAB bondholders will remain blocked from seizing assets of the Mexican glassmaker while an appeal over the company’s bankruptcy plan is pending, an appeals court decided.
The stay that a bankruptcy judge in Dallas imposed last month will “remain in place during the pendency of this appeal or until further order of this court,” the U.S. Court of Appeals in New Orleans said today.
Vitro appealed after U.S. Bankruptcy Judge Harlin DeWayne Hale refused to enforce the company’s Mexican reorganization plan in the U.S. last month, saying it was “manifestly contrary” to U.S. public policy. A Mexican court approved the plan in February, after more than a year of legal battles between Vitro and bondholders including Paul Singer’s Elliott Management Corp.
The company is pleased the appeals court “extended the temporary restraining order, thereby providing important clarity and certainty for Vitro’s U.S. customers throughout the appeal process,” said Roberto Riva Palacio, a spokesman for Vitro, which is based in San Pedro Garza Garcia, Mexico.
Donald Cutler, a spokesman for bondholders, declined to comment.
The case is Vitro SAB v. Ad Hoc Group of Vitro Noteholders, 12-10689, U.S. Court of Appeals for the Fifth Circuit (New Orleans).