Debtor-Creditor

News & Analysis as of

Eighth Circuit Applies Subsequent New Value Defense To Payments Received From Third Party Creditor

The Eighth Circuit held that preferential payments are subject to a new value defense of § 547(c)(4) where the new value was provided by a third party that benefitted from the preferential transfers....more

New Jersey Appellate Court Clarifies Debt Buyers’ Burden Of Proof

On March 5, the Superior Court of New Jersey, Appellate Division issued an opinion clarifying the proof necessary for debt buyers to prevail on efforts to collect an assigned debt on a closed and charged-off credit card...more

Closing the Chapter 7 Loophole for High Income Debtors

Heralded by debtor’s attorneys as “a wonderful loophole”1 in the Bankruptcy Code, a debtor who has primarily business, rather than consumer, debts can qualify for a speedy Chapter 7 discharge despite a high earning capacity...more

Proof of Claim Could Cost You Your Privilege - Bankruptcy Court Holds Attorney's Signature on Proof of Claim Form Renders Attorney...

A properly filed proof of claim serves as prima facie evidence as to a claim's validity. But when this written statement is signed by a creditor's attorney, the court may find that the attorney has become a fact witness and...more

Status as a Debtor not Enough to Confer Appellate Standing

“Standing” is a legal term of art that refers to a party’s ability to bring a cause of action, to intercede in one or to appeal the court’s judgment. To prove appellate standing in a bankruptcy proceeding, a party must show...more

Former Colorado regulator and consumer advocate Laura Udis to join CFPB as manager for payday lending program

We have learned that, starting Monday, Laura Udis will join the CFPB as the Payday and Small Dollar Lending Program Manager in Research, Markets and Regulations. Ms. Udis comes to the CFPB from the Consumer Federation of...more

Creditors’ Deficiency Rights Impacted by Recent Nevada Supreme Court Opinion in Sandpointe Apartments, LLC v. Eighth Judicial...

On November 14, 2013, in Sandpointe Apartments, LLC v. Eighth Judicial District Court, 129 Nev. Adv. Op. 87 (Nov. 14, 2013), and in Branch Banking and Trust Co. v. Neilson, (Nov. 14, 2013) (unpublished), the Nevada Supreme...more

Is “Inadvertence” a Good Excuse When a Debtor Fails to List a Pending Lawsuit Among the Bankruptcy Estate Assets? Maybe So.

Earlier this year, the Ninth Circuit issued an opinion that caused a stir among bankruptcy law aficionados. In Ah Quin v. County of Kauai DOT, the Ninth Circuit court was faced with a bankruptcy debtor who failed to list her...more

Orrick's Financial Industry Week in Review - July 29,2013

FHFA Statement on Freddie Mac Risk-Sharing Transaction - On July 24, the FHFA announced that Freddie Mac is nearing completion of its first risk-sharing transaction, a direct debt issuance, that will assist Freddie Mac...more

9th Circuit Allows Certain Consensual Liens to Be Avoided In Chapter 7 Bankruptcy; Still, the Devil Is In the Details

In 2010, a realtor in bankruptcy sought to avoid a consensual nonpurchase money lien she gave in her Mercedes Benz in exchange for a $22,000 loan because, in her words, that luxury automobile was “intrinsically ...more

I need to file bankruptcy, but I WANT to pay certain people!

Many people who need to file bankruptcy also want to pay certain people or businesses, particularly if they have a personal relationship with them. Wanting to pay family members and friends is very common, as is the desire to...more

Can't You Hear Me Knocking? The Dreaded Preference Demand

You are in your office finishing your morning espresso when you receive an email from the CFO of your companies' U.S. subsidiary. Attached to the email is a letter from a U.S. law firm. Instinctively, you know this can't be...more

When Lenders are the Losers in Bankruptcy Court...Well, Not so Fast

Last October, I wrote about a scheme employed, in three separate bankruptcy cases, by debtors seeking to evade the absolute priority rule in order to keep the real property owned by the debtor in the hands of the ‘family’ at...more

Shedding Light on Whether Electricity is a "Good:" In re Southern Montana Electric Generation and Transmission Cooperative, Inc.

The question of whether electricity qualifies as a "good" under the Bankruptcy Code's administrative priority provisions has sparked varied rulings from bankruptcy courts. The recent case of In re Southern Montana Electric...more

In re Hostess Brands, Inc.: Southern District of New York Bankruptcy Court Refuses to Send Cash Collateral Dispute to Arbitration

On January 7, 2013, the Judge Robert D. Drain of the United States Bankruptcy Court for the Southern District of New York held that a dispute concerning the debtors’ use of cash collateral was not subject to arbitration,...more

Sixth Circuit Holds That Mortgage Foreclosures Are Debt Collections Under The FDCPA

On January 14, the U.S. Court of Appeals for the Sixth Circuit held that mortgage foreclosures are debt collections under the FDCPA. Glazer v. Chase Home Finance LLC, No. 10-3416, 2013 WL 141699 (6th Cir. Jan. 14, 2013). The...more

Fifth Circuit Crafts New Test For Foreign Debtor Relief

Originally published in the New York Law Journal on January 3, 2012. On Nov. 28, 2012, the U.S. Court of Appeals for the Fifth Circuit in In re Vitro S.A.B. de C.V. issued a groundbreaking decision under Chapter 15 of...more

Catching Up on Chapter 11 Reform ... ABI Commission Enters Second Year

Originally published in ABL Advisor on 1/15/2013. As co-chairs of the American Bankruptcy Institute’s Commission to Study the Reform of Chapter 11 (ABI Commission), we are proud to note that the ABI Commission is...more

Fourth Circuit Holds State Auto Debt Cancellation Requirements Not Preempted For Certain Assigned Loans

On December 26, the U.S. Court of Appeals for the Fourth Circuit held that federal law does not preempt Maryland’s debt cancellation requirements for an auto retail installment sales contract (RISC) when a national bank is...more

Fifth Circuit Crafts New Test For Foreign Debtor Relief

Originally published in the New York Law Journal on January 3, 2012. On Nov. 28, 2012, the U.S. Court of Appeals for the Fifth Circuit in In re Vitro S.A.B. de C.V. issued a groundbreaking decision under Chapter 15 of...more

What’s In A Name: In California, Borrowers May Be Liable For Purely Innocent “Bad Faith” Waste

The phrase “bad faith” has been defined as, “intention to deceive; treachery or dishonesty”. When most attorneys hear the phrase “bad faith,” they think of tort claims against insurance companies (“bad faith litigation”) or...more

New Law Aims To It Easier To Levy On Bank Accounts

Last year, the Consumer Financial Services Committee of the Business Law Section of the California State Bar sponsored AB 2364 (Wagner). This bill, which took effect on Tuesday, is intended to simplify the process for levying...more

UPDATE: Court Rejects CalPERS’ Efforts to Lift Stay In San Bernardino Case

In a ruling predicted by the Restructuring Review Blog last month, Judge Meredith A. Jury of the U.S. Bankruptcy Court for the Central District of California rejected arguments by CalPERS that the Bankruptcy Court should lift...more

The Magic of The “Automatic Stay”: Part 1

For me, the keystone or centerpiece of all of the interacting parts of the Bankruptcy Code is the automatic stay. The stay is the fundamental shield available to our clients who file for relief from creditors in a Chapter 7...more

The Time is Now…

Here we are. New year. If you are like me you look back and evaluate whether or not you met last year’s goals. And if you are like me you didn’t reach some of your goals. If you are still dealing with the same debt you...more

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