The Bankruptcy Law Firm, Prof. Corp.
US Supreme Court’s decision in Roman Catholic Archdiocese of San Juan, Puerto Rico v. Acevedo Feliciano, Doesn’t Preclude Annulling the Stay, Eleventh Circuit Says; there is a Circuit Split on this issue
On an issue where the lower courts are split, the Eleventh Circuit held that the Supreme Court’s decision in Roman Catholic Archdiocese of San Juan, Puerto Rico v. Acevedo Feliciano, 589 U.S. 57 (2020), does not prevent bankruptcy courts from annulling the automatic stay under Section 362(d)(1). In Acevedo, the Supreme Court strictly limited the ability of federal courts to enter orders nunc pro tunc. In his July 8 opinion, Chief Circuit Judge William H. Pryor, Jr., adopted the position taken by the Ninth Circuit Bankruptcy Appellate Panel in a 2020 opinion by Bankruptcy Judge William J. Lafferty, III. In…
In re GOL Linhas Aéreas Inteligentes SA, 225-4610 (S.D.N.Y. June 5, 2025)
The Office of US Trustee has already appealed the following US District Court, New York decision– In re GOL Linhas Aéreas Inteligentes SA, 225-4610 (S.D.N.Y. June 5, 2025)– to the US Court of Appeals for the 2nd Circuit, to test the question of, whether after the US Supreme Court Purdue Pharma decision a chapter 11 plan can provide non-debtors get releases, unless creditors OPT OUT, of that provision, instead of NO non-debtor releases, unless creditors Opt-In (ie affirmatively agree to non-debtors being granted releases. The debtor agreed not to raise equitable mootness on an appeal only challenging nondebtor opt-out releases.…
U.S. Recurring Jobless Claims Jump to Highest Since End of 2021
Recurring applications for U.S. unemployment benefits rose to the highest level since the end of 2021, adding to evidence that it is taking unemployed Americans longer to find a new job, Bloomberg News reported. Continuing claims, a proxy for the number of people receiving benefits, advanced to 1.96 million in the week ended May 31, according to Labor Department data released today. Meanwhile, a measure of new filings that smooths volatility climbed to its highest level since August 2023. The spike in recurring claims coincides with a slowdown in hiring, suggesting that out-of-work people are struggling to find employment. However,…
Chenault-Vaughan Family Partnership Ltd. V. MDC Reeves Energy LLC (In re MTE Holdings LLC), 23-1916 (3d Cir. May 7, 2025), appeal 23-1916
Third Circuit Holds: Magistrate Judges May Issue Final Orders on Bankruptcy Appeals if all parties to the appeal consent to that (which does not happen very often) The Third Circuit splits from Seventh and Tenth Circuit opinions dating from 1987 and 1990. Creating a circuit split, the Third Circuit held that “a magistrate judge may enter final judgment in a bankruptcy appeal” if there is “consent of the parties and referral by a district court.” The Seventh and Tenth Circuits had ruled to the contrary in 1987 and 1990, holding that magistrate judges may not enter final orders in bankruptcy…
Chapter 7 Bankruptcy Filings in April 2025
American Bankruptcy Institute on 5/2/25 reports that US nationwide Consumer Chapter 7 Bankruptcy Filings in April 2025 are an Increase of 16% above April 2024 US nationwide consumer Chapter 7 bankruptcy filings; and total nationwide bankruptcy filings (all Chapters, consumer and business bankruptcy filings) in April 2025 are an increase of 9% above April 2024 total US bankruptcy filings The 30,961 individual chapter 7 filings in April 2025 represented a 16 percent increase over the 26,781 filings recorded in April 2024, according to data provided by Epiq AACER, the leading provider of U.S. bankruptcy filing data. Total individual bankruptcy filings…
Manion v. Strategic Funding Source Inc. (In re Manion), ___BR___ (B.A.P. 9th Cir. March 19, 2025); BAP appeal 24-1008
Fraudulent ‘Omission’ Isn’t a ‘Statement’ for Nondischargeability Purposes, BAP Says If a fraudulent omission were a ‘statement,’ the BAP explains why nondischargeability would be almost impossible to prove. For nondischargeability, the Ninth Circuit Bankruptcy Appellate Panel wrote an opinion explaining why a fraudulent omission falls into the orbit of a “false representation” under Section 523(a)(2)(A), not “a statement respecting the debtor’s . . . financial condition.” The difference is critical. As a “false representation,” a creditor subject to a fraudulent omission has an easier path to nondischargeability. The individual debtor was under contract with a major brewer to operate mobile…
Growing Number of Americans Are Using Buy Now, Pay Later Loans
Credit & Collection e-newsletter of 4/28/25 reports: A growing number of Americans are using buy now, pay later loans (BNPL loans) to buy groceries, and more people are paying those bills late, according to new Lending Tree data released Friday. The figures are the latest indicator that some consumers are cracking under the pressure of an uncertain economy and are having trouble affording essentials such as groceries as they contend with persistent inflation, high interest rates and concerns around tariffs. In a survey conducted April 2-3 of 2,000 U.S. consumers ages 18 to 79, around half reported having used buy…
Lawsuit Over Rule on Credit Card Late Fees
Credit & Collection e-newsletter of 4/15/25 reports: The Consumer Financial Protection Bureau today reached an agreement with the American Bankers Association and other plaintiffs to settle a lawsuit over its rule on credit card late fees. The CFPB last year issued a final rule to lower the safe harbor dollar amount for late fees to $8, eliminate a higher safe harbor dollar amount for late fees for subsequent violations of the same type, and eliminate the annual inflation adjustment for the safe harbor amount that was provided by the Federal Reserve in 2010. ABA joined the U.S. Chamber of Commerce…
Notice: All dollar amounts in US Bankruptcy Code increased by 13.2% on 4/1/25
Every 3 years, the dollar amounts in the US Bankruptcy Code, 11 USC 101 et seq, are adjusted for inflation. On 4/1/25, all the dollar amounts in the US Bankruptcy Code adjusted for inflation. Because there has been a total of 13.2% inflation in the past 3 years (last adjustment before 4/1/25 was on 4/1/22) the dollar amounts in the U.S. Bankruptcy Code each increased by 13.2%. Chapter 13 bankruptcy, and “SubV” Chapter 11 bankruptcy each have debt limits. A person cannot file Chapter 13 bankruptcy (individual wage earner repayment plan bankruptcy) or SubV Chapter 11 bankruptcy, unless dollar amount…
Johnson & Johnson’s Third Bankruptcy Case for Talc Lawsuits Thrown Out
On 4/1/25, a US bankruptcy judge dismissed Johnson & Johnson’s (“J&J”) third attempt to resolve its mass talc liabilities through chapter 11, rejecting the company’s latest bid to end one of the largest-ever mass torts. J& J had set up an “affiliate” corporation to J&J, and had the affiliate corporation file bankruptcy ins Texas. J&J put the liabilities for the mass tort suits suing J&J, for J&J’s talc baby powder allegedly causing people to get cancer, particularly allegedly causing women to get ovarian cancer. Judge Christopher Lopez of the U.S. Bankruptcy Court in Houston dismissed a J&J affiliate’s chapter 11…