July 20, 2026 - Celsius Network, QVC Group

This episode covers key developments in two major restructuring and bankruptcy cases:

The Celsius Network bankruptcy produces a landmark ruling establishing the first judicial framework for valuing appreciating cryptocurrency in clawback actions. The court rejects a one-size-fits-all approach, instead adopting a fact-specific methodology that ties recoveries to whether digital assets were held, sold, or lost—creating an important precedent for thousands of pending avoidance actions and future crypto bankruptcies.

QVC Group secures confirmation of its prepackaged Chapter 11 plan over vigorous objections from preferred shareholders, with the court approving a complex intercompany settlement after finding the company's independent governance process satisfied the business judgment standard. The ruling also upholds consensual opt-out third-party releases and confirms that preferred shareholders are out of the money despite challenging the allocation of enterprise value.

💡 From groundbreaking cryptocurrency valuation principles to complex corporate governance and plan confirmation issues, this episode examines how bankruptcy courts are addressing novel legal questions that could shape restructurings far beyond these individual cases.

Thank you for listening! Visit researchsuite.stretto.com for more information.

Follow us on LinkedIn.

Transcript

Copy Transcript Copied

SPEAKER_00 0:02

Welcome to Stretto's Restructuring Report, a podcast featuring notable stories curated by professionals and powered by Stretto Intelligence. Join us each week for the highlights, updates, and news impacting restructuring professionals. Want to go deeper than the headlines? Research Suite by Stretto lets you search across every jurisdiction in one place, with AI summaries cited directly to the docket so you can find, review, and understand the information that matters most. Try the Essential Plan free at researchsuite.stretto.com. Story 1. Celsius Court sets first framework for valuing appreciating crypto in clawback actions. Celsius Network, a cryptocurrency platform, filed for Chapter 11 protection in the Southern District of New York on July 13, 2022. Nearly four years later, on July 10th, 2026, the bankruptcy court answered a question no court had squarely decided before. When a crypto transfer is clawed back, how do you put a value on a coin that keeps moving? The problem is volatility. Between the day a Celsius customer withdrew coins and the day a judgment enters against them, that crypto can double, collapse, or vanish. Under section 550 of the bankruptcy code, when a transfer is avoided, the estate can recover either the property itself or its value. But the statute never says when that value should be measured. The estate's litigation administrator wanted a single measure, the value on the judgment date, applied across the board. The court declined. Instead, it built a framework that turns on what actually happened to the asset. If the coin lost value since the transfer, the estate recovers its value on the transfer date, whether or not the defendant still holds it. That half follows settled law. The harder half is appreciation. If a coin gained value and the defendant still holds it, the estate recovers the coin itself. If the defendant sold it at a profit, the estate recovers the sale price, the actual gain that changed hands. If the defendant sold at a loss, recovery reverts to the transfer date value. And if the coin is simply gone for any reason other than a sale, the estate recovers its value on the judgment date. The court was explicit that it was not aware of any other court that had ruled on how to value appreciating digital assets in an avoidance action. A prior matter involving transferred Bitcoin came close, but it settled before a decision. So this opinion supplies the first reason template for the thousands of Celsius customer clawback actions that follow it and for the next crypto estate that has to litigate the same problem. One practical point matters here. The burden of proving a sale and the price it produced sits on the defendant, not the estate. A defendant who sold coins at a modest profit years ago, but who cannot produce the exchange records to prove it does not fall back to a lower number. That defendant is exposed to the current higher judgment date value. In an appreciating market, the transaction record is the asset, and preserving it is the difference between a judgment measured by what the defendant actually received and one measured by a market price the defendant never saw. Story 2. QVC Group wins confirmation of prepackaged plan over preferred shareholder objection. In other bankruptcy news, QVC Group won confirmation of its Chapter 11 plan on July 15, 2026, in the Southern District of Texas. QVC Group is one of the world's largest multimedia retailers, reaching more than 200 million households a day across 15 television channels, along with more than 12 million streaming customers and a family of home and apparel brands. It filed for bankruptcy in April of 2026, carrying roughly $6.5 billion in funded debt. The case was not really about whether the retailer could survive. Its creditors had already lined up behind a pre-packaged deal. The real fight was structural, whether a sweeping settlement of claims between affiliated companies, negotiated by people who effectively sat on both sides of the table, could be approved and carried into a confirmed plan. The parent company's preferred shareholders said no, and they lost at every level. Over a 103-page decision built on a four-day trial record, the court approved the settlement and overruled every objection. The outcome turned on governance. Months before filing, the company appointed independent, disinterested directors at each of four corporate silos and gave each its own separate conflicts counsel. Those directors reviewed tens of thousands of documents, held more than 25 meetings, and interviewed current and former executives. Because that structure answered the conflict before it could taint the deal, the court applied the deferential business judgment standard rather than the more demanding entire fairness review the shareholders wanted. The settlement itself was a value allocation. The operating side fixed its claim against the parent at $400 million and took the parent's cash plus a 62% stake in the reorganized cornerstone brands. Third-party unsecured creditors were paid in full. The preferred shareholders at the very top received no cash and no equity. What they received instead was a release from claims tied to roughly $456 million in dividends they had already collected. The shareholders argued that a release worth a lot to some class members and nothing to others meant unequal treatment, invoking the Fifth Circuit CERTA decision. The court disagreed, drawing a distinction. An indemnity creates an affirmative right to payment that can be worth different amounts to different holders. A release only removes a liability and confers no such right. On that reasoning, the plan treated the class equally. The court also found the shareholders could do no better anywhere else. Even at the high end of the cornerstone valuation, that stake plus the parent's cash falls short of the $400 million claim standing ahead of them, so they recover nothing in any scenario. Finally, the court upheld the plan's opt-out third-party releases as consensual, consistent with the Supreme Court's Purdue Pharma decision, which barred only non-consensual releases. The plan is confirmed, though it is not yet effective. That's it for this week's restructuring report. For more case summaries, court updates, and bankruptcy insights, subscribe wherever you get your podcasts. And when you need the full story behind a case, Research Suite by Stretto gives you access to cases across all jurisdictions in a single search. With summaries cited straight to the source. Start free with the Essential Plan at researchsuite.stretto.com.