Recent Cases
In re Archdiocese of Milwaukee (Official Committee of Unsecured Creditors v. Archdiocese of St. Paul and Minneapolis), ___BR___, 2016 WL7115977 (US DC ED Wisconsin 2016)
In re Archdiocese of Milwaukee (Official Committee of Unsecured Creditors v. Archdiocese of St. Paul and Minneapolis), ___BR___, 2016 WL7115977 (US DC ED Wisconsin 2016): US District Court affirmed, on appeal, the bankruptcy court’s denial of substantive consolidation. The Bankruptcy Court decision is 483 BR 693, 2012 WL 6093494 (Bky Ct. ED Wisconsin 2012). The Bankruptcy Judge had denied motion of creditors committee to substantively consolidate non-bankrupt catholic schools and parishes into the bankruptcy case of the Catholic Archdiocese in which those non-bankrupt catholic schools and parishes were nocated. On appeal, the US District Court, ED Wis 2016, agreed that…
Midland Funding, LLC v. Hill
Midland Funding, LLC v. Hill: On 10/11/16, the US Supreme Court has granted a petition for certiorari, to hear creditor Midland Fundings’ appeal to US Supreme Court, from 11th Circuit Court of Appeals, of Hill v Midland Funding, LLC, 823 F.3d 1334 (11th Cir 2016). By deciding Midland Funding, LLC v Hill, the US Supreme Court is expected to resolve the split in cases of various Circuits, as to whether or not it violates the Fair Debt Collection Practices Act (FDCPA), for a creditor to file a Proof of Claim in a bankruptcy case, to try to collect a claim…
In re Ritz,___F.3d ___, 2016 Westlaw 4253552 (5th Cir. 2016)
In re Ritz,___F.3d ___, 2016 Westlaw 4253552 (5th Cir. 2016): The US Fifth Circuit Court of Appeals held that when a corporations controlling shareholder “loots” (takes without right) money or assets of the corporation, that the controlling shareholder does that, that looting qualifies as an “actually fraudulent” transfer, which can be recovered from the insider, possibly by “piercing the corporate veil”. In Ritz, a supplier sold merchandise to a corporation. The corporation’s controlling shareholder siphoned off its assets for his own benefit. Following the shareholder’s bankruptcy filing, the supplier sought to pierce the corporate veil in order to hold the…
In re City of Detroit, Michigan, ___F.3d___, 2016 WL 5682704 (6th Circ.10/3/16
In re City of Detroit, Michigan, ___F.3d___, 2016 WL 5682704 (6th Circ.10/3/16): The Sixth Circuit refused to reverse cuts to pensions of Detroit municipal retires. The retires pension benefits were cut as part of Detroit City chapter 9 bankruptcy plan. The retirees appealed to the 6th Circuit Court of Appeals. The Sixth Circuit based its ruling on the fact that too many significant or irreversible actions taken under the Chapter 9 plan, would have to be unraveled, for the cut pension benefits to be restored. There was a dissent 2-1. The split decision of the 6th Circuit concurred with a…
Hernandez v. Williams Zinman & Parham, ___ F3d ___ (9th Cir. 7/20/16) (appeal no. 14-15672)
Hernandez v. Williams Zinman & Parham, ___ F3d ___ (9th Cir. 7/20/16) (appeal no. 14-15672): The U.S. Court of Appeals for the Ninth Circuit, in a case of first impression and the first published circuit court opinion to address the issue, recently held that each and every debt collector – not just the first one to communicate with a debtor – must send the debt validation notice required by the federal Fair Debt Collection Practices Act. A copy of the opinion in is available at: Link to Opinion. A consumer financed the purchase of her automobile, but stopped making payments…
Adinolfi v. Meyer (In re Adinolfi), ___BR___ (9th Cir. BAP 2016)
Adinolfi v. Meyer (In re Adinolfi), ___BR___ (9th Cir. BAP 2016): In a two judge with one judge dissenting decision, the Ninth Circuit’s Bankruptcy Appellate Panel wrote an opinion that could be interpreted to mean that benefits received under most programs governed by the Social Security Act are not “disposable income” that must be devoted to payment of creditors’ claims in a chapter 13 plan. In Adinolfi, Chapter 13 debtor was receiving $1,400 a month to care for a child adopted from foster care. Both the majority and the dissent based their opinions on the language of Sections 1325(b)(1) and…
Bourne Valley Court Trust vs. Wells Fargo Bank, N.A., ___F.3d___, 2016 Westlaw 425498 (9th Cir. 2016)
Bourne Valley Court Trust vs. Wells Fargo Bank, N.A., ___F.3d___, 2016 Westlaw 425498 (9th Cir. 2016): The Ninth Circuit has held that a Nevada statute that extinguished mortgage liens following HOA foreclosure sales was unconstitutional and violated the lenders’ due process rights because the statutory notice provisions were inadequate.
DJM Associates LLC v. Capasso, ___ F.Supp.3d ___ (DC ED NY 2016) case number 97-7285 (E.D.N.Y. Sept. 22, 2016)
US District Court held that Successor to Bankrupt Company was liable for Pre-Bankruptcy Environmental Claims Although the facts existed and a statute had been adopted before bankruptcy giving rise to a claim that would be discharged, the claim was not discharged because the Supreme Court did not hand down a decision until years after bankruptcy recognizing a private right of action. The Sept. 22 decision by Chief District Judge Dora L. Irizarry in Brooklyn, N.Y., means that a confirmed chapter 11 plan is no shield to environmental contribution claims not recognized by statute or case law until after bankruptcy. This…
Green Tree Servicing LLC v. Giusto, 2016 Westlaw 3383959 (N.D.Cal. 2016)
A US District Court in California held that a debtor could not receive an award of attorney’s fees expended by debtor’s attorney, to defeat the relief from stay motion brought by the DOT loan lender on debtor’s house, because the motion was not an “action on a contract” under California law.
Kirkland v. Rund (In re EPD Investment Co.), 821 F.3d 1146 (9th Cir. 2016)
The United States Court of Appeals for the Ninth Circuit affirmed the district court’s decision affirming the bankruptcy court’s denial of a motion to compel arbitration in a chapter 7 trustee’s adversary proceeding seeking avoidance of fraudulent transfers and disallowance and subordination of claims.