The Bankruptcy Law Firm, Prof. Corp.
On 12/14/14, the US Supreme Court Granted Petitions for Certiorari (ie has agreed to review) in Two Different Bankruptcy Cases, Agreeing to Review Two Different Bankruptcy Issues
There is no right to appeal a bankruptcy issue from a US Court of Appeals, to the US Supreme Court. Instead, a party requests the US Supreme Court to review a bankruptcy decision (and most other kinds of decisions) of a US Court of Appeals, by filing a Petition for Certiorari with the US Supreme Court. Thousands of Petitions for Certiorari are filed each year, with the US Supreme Court, in various subject matters of cases. The US Supreme Court only grants certiorari (agrees to review the US Court of Appeals decision) in a tiny percent of those petitions for…
US Supreme Court has Recently Granted Petitions for Certiorari on Two Cases
The US Supreme Court has recently granted petitions for certiorari on two cases–Bank of America v. Calukett and Bank of America v. Toledo-Cardona–involving mortgage lien-stripping in bankruptcy. The fact that the US Supreme Court granted certiorari, regarding these two cases, means that the US Supreme Court will review, and could either affirm or reverse, the two US Courts of Appeal decisions. If the US Supreme Court were to reverse present law, which is that lienstripping is NOT allowed in Chapter 7, and is only allowed (under specific, limited, circumstances in Chapter 11, 12 and 13), that would be a HUGE…
In re NNN Parkway 400 26, LLC, 2014 Westlaw 309734 (Bankr. C.D. Cal. 2014)
In re NNN Parkway 400 26, LLC, 2014 Westlaw 309734 (Bankr. C.D. Cal. 2014). A bankruptcy court in California has held that a “new value” Chapter 11 reorganization plan requires a genuine market test of the value of the equity, that the lender’s deficiency claim could not be gerrymandered where the guarantor was insolvent, and that the artificial impairment of a consenting class cannot be the result of abusive conduct. Facts: A group of Chapter 11 debtors sought confirmation of a plan of reorganization that sought to invoke an exception to the “absolute priority rule” of 11 U.S.C.A. § 1129(b)(2)(B)(ii).…
In re Sui ___BR___, 2014 WL 5840246
In re Sui ___BR___, 2014 WL 5840246 (9th Cir. BAP 11/10/14), BAP case number 11-20448-CB: In Sui, Chapter 7 debtor Yan Sui ("Debtor") and non-debtor Pei-yu Yang ("Ms. Yang"), both acting pro se, appealed jointly from a bankruptcy court order barring each of them from filing "initiating documents" in the Debtor’s bankruptcy case without advance review by the bankruptcy court and a determination that such documents were meritorious. The order also required the Debtor and Ms. Yang to obtain leave from the bankruptcy court before filing suit in any forum against the Chapter 7 trustee, Richard A. Marshack (the "Trustee"),…
Bankruptcy Judge’s Ruling in City of Stockton Chapter 9 (Municipality) bankruptcy case, which allowed Stockton to reduce its pension debt owed to present and retired City Employees, Is Not a Free Pass for Cities to Cut Pensions, say Experts
Bankruptcy Judge’s Ruling in City of Stockton Chapter 9 (Municipality) bankruptcy case, which allowed Stockton to reduce its pension debt owed to present and retired City Employees, Is Not a Free Pass for Cities to Cut Pensions, say Experts Although Judge Christopher M. Klein ruled on Wednesday in the Stockton, Calif., chapter 9 case that the city could use bankruptcy to wipe away its pension debt, experts do not view the bankruptcy judge’s oral statement as a free pass for other California cities struggling with rising pension costs, the New York Times reported on Friday. “He did give us a…
US Supreme Court has granted certiorari, to hear appeal on Baker Botts LLP v. ASARCO LLC
On Oct. 2, 2014, the U.S. Supreme Court granted certiorari in Baker Botts LLP v. ASARCO LLC, No. 14-103. Baker Botts, which represented debtor-in-possession ASARCO LLC in one of the largest and most complex chapter 11 bankruptcy cases ever, obtained a fee award from the bankruptcy court of $113 million for fees and costs, $4.1 million as an enhancement, and $5 million for defending its fee application. On appeal, the Fifth Circuit Court of Appeals reversed the $5 million award for defense of the fee application. Citing In re Pro-Snax Distributors Inc., 157 F.3d 414 (5th Cir. 1998), and Bankruptcy…
Secondary Debt Collectors Must Give Notice, Judge Says
The fair Debt Collection Practices Act requires subsequent debt collectors to notify consumers in writing, even if the prior holder or debt collector had already given notice, a federal judge has ruled. Deciding an issue that has divided courts, Southern District Judge William Pauley III said secondary collectors still must send a validation notice to avoid confusion by consumers over who holds the debt and whether they have the right to contest it. In Tocco v. Real Time Resolutions, 14-cv-810, Pauley said the requirement of a validation notice in 15 U.S.C. &1692g “applies to initial communications from each successive debt…
Schultze v. Chandler
Schultze v. Chandler, ___F.3d ___, 2014 WL 3537030 (9th Cir. July 18, 2014, amended August 1, 2014): In a published decision, the Ninth Circuit Court of Appeals held that a post-petition malpractice claim originally filed in state court against an attorney for an unsecured creditors’ committee is a core proceeding. Agreeing with other circuits, the Ninth Circuit found that the malpractice lawsuit, which was removed to a bankruptcy court from state court, fell within the definition of a core proceeding because: (1) the attorney’s employment and compensation was approved by the bankruptcy court; (2) his duties as committee counsel pertained…
Wortley V. Chrispus Venture Capital LLC (In re Global Energies LLC), ___F.3d___, 2014 WL 3974577 (11TH CIR. 8/15/2014)
The Eleventh Circuit Court of Appeals held that the bankruptcy court abused its discretion and applied the incorrect legal standard in denying Joseph G. Wortley’s (“Wortley”) FRCP Rule 60(b)(2) [incorporated into bankruptcy practice by FRBP Rule 9024] motion to set aside an order denying Wortley’s motion to dismiss, with prejudice, an involuntary chapter 11 case that business partners of Wortley had filed, against Global Energies, LLC (the entity that Wortley, and Wortley’s partners were partners in), as respondent. The Eleventh Circuit decision remanded the case, with instruction to the bankruptcy court to grant Wortley’s Rule 60(b)(2) motion, and instructed the…
DeNoce v. Neff (In re Neff)
DeNoce v. Neff (In re Neff), 505 B.R. 255 (9th Cir. BAP 2014): In a published decision the U.S. Bankruptcy Appellate Panel of the Ninth Circuit ("BAP") affirmed a bankruptcy court’s order granting a debtor partial summary judgment against a denial of discharge complaint that alleged debtor should be denied a discharge because debtor had, within 1 year before debtor filed bankruptcy, made a fraudulent transfer of some of debtor’s property, and had made that transfer with an actual intent to hinder, delay, or defraud creditors. the BAP held that the one-year "lookback period" of Bankruptcy Code 11 USCn 727(a)(2)(A)…