By Ed Ripley of King & Spalding
(Sept. 7) – On May 25, the United States Court of Appeals for the Second Circuit affirmed a district court’s affirmance of a bankruptcy court’s decision in In re Sabine Oil & Gas Corp. which permitted a debtor to reject a midstream gathering agreement as an “executory contract.” Case No. 17-1026, 2018 U.S. App. LEXIS 13975 (2d Cir. May 25, 2018). The decision, which is the first court of appeals to address the rejection of a midstream gathering agreement, firmly establishes a debtor’s right to do so under certain circumstances.