Recent Cases
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"),…
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)…
Daniel Bock Jr. v Pressler & Pressler
Daniel Bock Jr. v Pressler & Pressler, Civ. No. 11-7593 (KM)(MCA), 2014 WL 2937929, (D.N.J. June 30, 2014), in which a US District Court held that a Law Firm violated the federal Fair Debt Collection Practices Act (“FDCPA”) when a lawyer of that Law Firm signed the Complaint, which Law Firm then filed in Court, to commence a lawsuit against the consumer who owed the debt to plaintiff company, seeking to collect the debt from consumer, only spent a few seconds reviewing and signing the Complaint, before that Complaint was filed in Court. Four second review did not comply with…
Crawford vs. LVNV Funding, LLC
Crawford vs. LVNV Funding, LLC, ___F.3d___, 2014 Westlaw 3361226 (11th Cir. 2014): held that a bulk debt buyer violated the federal Fair Debt Collection Practices Act (“FDCPA”) by filing a proof of claim in a consumer bankruptcy, based on a time-barred debt. There is a multi-Circuit split on this issue. Crawford is directly contra to a Second Circuit Court of Appeals decision Simmons v. Roundup Funding, LLC, 622 F.3d 93 (2nd Cir. 2010) in which the Second Circuit held that filing a proof of claim (on an unenforceable debt) is not a violation of FDCPA, that FDCPA does not apply…
Hoskins v. Citigroup
HOSKINS V. CITIGROUP (IN RE VIOLA; 9TH CIR., July 16, 2014) case 12-60032, not for publication The Ninth Circuit Court of Appeals ruled that a “transferee”, as that term is used in Bankruptcy Code section 11 U.S.C. § 550(a)(1), is one who has legal title to the funds and the ability to use them as the recipient sees fit. This is the “dominion test.” The Ninth Circuit ruled that allegations of open and exclusive control through fraudulent misappropriation of funds is insufficient to satisfy the dominion test. The case is “not for publication”. But still sheds light on Ninth Circuit’s…
Robinson v. American Home Mortgage Servicing, Inc. (In re Mortgage Electronic Registration Systems, Inc.)., __F/3d__, 2014 WL 2611314 (9th Cir. 6/12/14)
On June 12, 2014, the 9th Circuit Court of Appeals issued its decision in). This decision is the result of multi-district litigation related to the operation of the MERS System and, with one exception, found in favor of the lenders on state law claims, such as, wrongful foreclosure, predatory lending, etc. The decision provides a good summary of the operation of the MERS System and prior case law on the topic. In this case, the 9th Circuit court of appeals held that: the District Court did not improperly convert a motion to dismiss for failure to state a claim into…
Rivera v. Orange County Probation Dep’t (In re Rivera), Case No. CC-13-1476-PaKiLa, ___BR___ (9th Cir. BAP June 4, 2014)
Rivera v. Orange County Probation Dep’t (In re Rivera), Case No. CC-13-1476-PaKiLa, ___BR___ (9th Cir. BAP June 4, 2014): Ninth Circuit Bankruptcy Appellate Panel held that amounts due to a county for food, clothing, and medical care for an incarcerated minor are nondischargeable "domestic support obligations" of the parents pursuant to 11 U.S.C. § 523(a)(5). Facts and Procedural History: The debtor’s minor son was incarcerated in Orange County from 2008 through 2010, for a total of 593 days. California law requires parents of an incarcerated minor to pay "costs of support" of the minor, which are limited to food, food…
Anil Sachan v. Benjamin Moonkang Huh (In re Benjamin Moonkang Huh)
Anil Sachan v. Benjamin Moonkang Huh (In re Benjamin Moonkang Huh), 506 B.R. 257 (9th Cir. BAP March 11, 2014)–published en banc Oionion of the United States Bankruptcy Appellate Panel of the Ninth Circuit ("BAP"–held that imputing fraud to a debtor for purposes of exception to discharge under 11 U.S.C. § 523(a)(2), where the evidence does not show that the debtor knew or had reason to know of the agent’s fraud, "…is not consistent with the provisions or objectives of the Bankruptcy Code." Facts: Pre-petition, the debtor was a licensed real estate broker in California. While initially operating a sole…