Hanjin Shipping Co., one of the largest shipping companies in the world based in Korea, filed for bankruptcy in Korea. Petitioners are holders of maritime lien over Hanjin, attempting to enforce the maritime lien in the United States. The court initially issued a provisional order stating that any Hanjin ship entering the U.S. port would be prohibited from leaving the U.S. until this matter is resolved. Upon the issuance of the order, the Hanjin ships headed for the U.S. turned around, causing financial consequences for the owners of the cargo aboard the ship. The court then lifted the order, based on submissions from cargo owners.
The court denied the motion for reconsideration filed by the lien holders, noting that Chapter 15 of the Bankruptcy Code favors the universalist approach that requires the court to assist the main bankruptcy proceeding in South Korea.
This is the correct result. The court's earlier provisional order was unwarranted, which caused confusion and waste that is contrary to the orderly disposition of global assets as provided by the Bankruptcy Code.
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