Section 105 of the Bankruptcy Code

Introduction

On August 20, 2010, Petroflow Energy Ltd. (“Petroflow”), filed a petition for bankruptcy in the United States Bankruptcy Court for the District of Delaware.  Months prior to Petroflow’s filing for bankruptcy, the company’s subsidiaries, North American Petroleum Corporation USA and Prize Petroleum LLC, filed petitions for bankruptcy in Delaware.  After Petroflow filed for

Introduction

On January 14, 2009,  Nortel Networks Inc. filed for bankruptcy in United States Bankruptcy Court for the District of Delaware.  On the same day that Nortel filed in Delaware,  its parent, Nortel Networks Corporation, along with various Canadian affiliates, filed an application with the Ontario Superior Court of Justice seeking relief from creditors.  As stated in Nortel’s affidavit in support of its bankruptcy motions,  Nortel traces its origins back to the Bell Telephone Company of Canada.  In 2000, during the height of the telecommunications bubble, Nortel had 93,000 employees and annual revenue of $250 billion. 

Since the telecommunications bust, Nortel implemented several restructurings, reducing its payroll from 93,000 employees to 30,000 employees in 2008.  To reduce itself to one third of its original size, Nortel began outsourcing its manufacturing, spinning off "non-core" business and consolidating various departments, including research and development.  Despite its restructuring efforts, Nortel has been unable to keep costs below revenue for the last couple of years, which in turn led to its filing for bankruptcy. 


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