The Bankruptcy Law Firm, Prof. Corp.
Opt-Out Lenders v. Millennium Lab Holdings II LLC (In re Millennium Lab Holdings II LLC), ___F.Supp.3d ___ (US District Court, District of Delaware 3/17/17)
Opt-Out Lenders v. Millennium Lab Holdings II LLC (In re Millennium Lab Holdings II LLC), ___F.Supp.3d ___ (US District Court, District of Delaware 3/17/17): US District Court for District of Delaware held Bankruptcy courts can’t issue final orders approving non-consensual third-party releases of non-bankruptcy claims, even as part of a Chapter 11 plan confirmation order. Without making a definitive ruling, a district judge in Delaware said that the US Supreme Court Stern v. Marshall case and its progeny preclude a bankruptcy court from entering a final order granting non-consensual third-party releases of non-bankruptcy claims, even as part of a chapter…
Tower Credit Inc. v. Schott (In re Jackson), 850 F.3d 816 (5th Cir. March 13, 2017)
Tower Credit Inc. v. Schott (In re Jackson), 850 F.3d 816 (5th Cir. March 13, 2017): US Supreme Court Won’t Decide a Circuit Split on Garnished Wages as Preferences The Supreme Court will not resolve a circuit split by deciding whether wages garnished within 90 days of bankruptcy are recoverable preferences. This morning, the high court denied a certiorari petition in Tower Credit Inc. v. Schott, 17-444 (Sup. Ct.), where the Fifth Circuit differed with three older circuit court decisions by holding in March that a wage garnishment resulted in a preference because the transfer was deemed to occur within…
Conflicting Outcomes, Between 2014 9th Circuit BAP Markosian v. Wu (In re Markosian), 506 B.R. 273 (9th Cir. BAP 2014), and 2 Bankruptcy Court Decisions from Other Circuits
Conflicting outcomes, between 2014 9th Circuit BAP Markosian v. Wu (In re Markosian), 506 B.R. 273 (9th Cir. BAP 2014), and 2 bankruptcy court decisions from other Circuits, which are In re Lincoln, BR ___, bky case number 16-12650 (Bankr. E.D. La. Feb. 8, 2017) and the 2015 Rogers v. Freeman (In re Freeman), 527 B.R. 527 (Bankr. N.D. Ga. 2015). The issue in all 3 cases is the same, and is this: When an individual’s chapter 11 case converts to chapter 7, does property acquired post-petition revert to the debtor or does it belong to the chapter 7 estate?…
Greif & Co. v. Shapiro (In re Western Funding Inc.), 550 B.R. 841 (9th Cir.BAP 2016) (“Greif”)
Greif & Co. v. Shapiro (In re Western Funding Inc.), 550 B.R. 841 (9th Cir.BAP 2016) (“Greif”): The U.S. Bankruptcy Appellate Panel for the Ninth Circuit (the “9th Circuit BAP”) held that the standards for approving a settlement agreement under Fed. R. Bankr. P. 9019(a) did not apply per se to a post-confirmation settlement agreement between a creditor and the liquidating trustee (the “Liquidating Trustee”), as liquidating trustees do not constitute “trustees” for purposes of the Bankruptcy Code and Bankruptcy Rules.
Wolf Metals Inc. v. Rand Pac. Sales, Inc., 4 Cal. App. 5th 698
Wolf Metals Inc. v. Rand Pac. Sales, Inc., 4 Cal. App. 5th 698 (2016), a published California Court of Appeals decision, the California Court of Appeal held that a judgment creditor could not amend a default judgment to add an additional individual judgment debtor under an “alter ego” theory, because doing so would violate that person’s due process rights, although adding a successor corporation to the judgment was permissible. Judgment creditors often want to add a nondebtor individual to a state court default judgment, because the corporation the judgment is against files bankruptcy, or is otherwise “uncollectible”. FACTS: Wolf Metals…
U.S. Bank N.A. v. The Village at Lakeridge, LLC
U.S. Bank N.A. v. The Village at Lakeridge, LLC (In re The Village at Lakeridge, LLC), 814 F.3d 993 (9th Cir. 2016): Held that purchasing a claim from an insider of the bankruptcy debtor does NOT necessarily result in the person/entity purchasing the claim becoming an insider. United States Court of Appeals for the Ninth Circuit held that a vote on a plan of reorganization submitted by a non-insider claimant was not to be disregarded under Bankruptcy Code section 1129(a)(10) merely because the claimant purchased the claim from an insider. FACTS: The debtor owned a commercial real estate development in…
In re Rexford Properties, LLC, ___BR___, 2016 Westlaw 5416443 (Bankr. C.D.Cal.2016)
In re Rexford Properties, LLC, ___BR___, 2016 Westlaw 5416443 (Bankr. C.D.Cal.2016): A bankruptcy court in California has held that the separate classification of a group of trade creditors in a Chapter 11 plan had to be based on a “legitimate business or economic justification,” but the debtor did not have to show that the special treatment of that group was “critical, essential, or necessary” to the reorganization. [.] FACTS: A Chapter 11 debtor negotiated a reorganization plan, under which certain of its unsecured creditors (primarily trade creditors) would be separately classified. The members of that class would be paid in…
Retailers’ Free Speech Challenge to Surcharge/discount Distinction for Describing Price Differences for Credit Card and Cash Sales
Retailers’ Free Speech Challenge to Surcharge/discount Distinction for Describing Price Differences for Credit Card and Cash Sales (US Supreme Court docket certarari granted on 10-20-16, and US Supreme Court heard argument of case on 1/11/17 :U.S. Supreme Court on 1/11/17 struggled over how to decide a challenge to a state law barring retailers from charging more to buy with credit instead of cash, debating whether it merely regulates prices or violates merchants’ constitutional rights. The eight justices heard an hour of arguments in an appeal brought by merchants to a lower court’s ruling upholding the New York law, which is…
Beware of Online Bankruptcy Solicitations
BEWARE OF SUPPOSED “NATIONAL” LAW FIRM (PRINCE LAW FIRM, LLC) WHICH ADVERTISED ON INTERNET, SOLICITING FOR BANKRUPTCY CASES, BUT WHICH WAS NOT A NATIONAL LAW FIRM, AND WHICH WAS FARMING THE CASES OUT TO LAW FIRMS IN VARIOUS STATES, SOMETIMES WITH BAD RESULTS: In re Aimee Dawn Futreal and Judge A. Robbins, US Trustee for Region Four, Movant v. Brent Barbour and Barry Proctor and Prince Law Firm, LLC, Respondents; and In re Micah Jerimey Repass and Holly Leigh Repass, Debtors, and Judgy A. Robbins, US Trustee for Region Four, Movant v. Brent Barbour and Barry Proctor and Prince Law,…
Midland Funding, LLC v. Johnson, St. Ct., No. 16-348
In Midland Funding, LLC v. Johnson, St. Ct., No. 16-348, appeal docketed Sept. 16, 2016: US Supreme Court in 2017 will hear and decide a bankruptcy case involving a debt collection agency and a consumer bankruptcy debtor. Issue is whether the Consumer Financial Protection Act prohibits a debt collection agency/creditor from filing a proof of claim, in a bankruptcy case, that is barred by the statute of limitations. More than two years into a litigation effort challenging the credit and collection industry’s practice of filing time-barred proofs of claim in consumer bankruptcy cases, all eyes are on the U.S. Supreme…