In What Circumstances Can U.S. and Other Foreign Judgments Be Enforced Against Cayman Islands Hedge Funds?

Parties considering bringing proceedings against Cayman Islands hedge funds in other jurisdictions should ensure that any judgment that might be obtained in a foreign jurisdiction will be recognized and enforced by the Cayman courts.  On the flip side, Cayman-domiciled hedge funds facing claims in foreign jurisdictions will need to consider the safety of ignoring and not participating in those proceedings, on the assumption that any judgment obtained will not be recognized and enforced by the Cayman courts.  In a guest article, Christopher Russell and Joanne Collett, Partner and Senior Associate, respectively, at Appleby, survey the landscape that informs whether Cayman courts will enforce such judgments.  These issues arise in particular in the context of enforceability of judgments obtained by default where the Cayman fund does not participate in the foreign proceedings, and in particular in the context of judgments and orders obtained in insolvency proceedings in light of the increasing trend towards universality of insolvency proceedings.

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