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Marco Rubio Opposes Bankruptcy Lifeline for Struggling Puerto Rico

Marco Rubio opposes giving Puerto Rico the same type of bankruptcy protection available to U.S. towns and cities mired in fiscal crisis, the Florida senator will say Friday as he visits the American territory for the first time as a 2016 contender, the Politico reported today. In an op-ed to be published in both Spanish and English, Rubio blames the "liberal ideology" of Puerto Rico's politicians, creating a "toxic brew of economic stagnation, higher taxes and bloated government." "Allowing Puerto Rican municipalities to reorganize their debts under chapter 9 of the U.S. Bankruptcy Code would not solve Puerto Rico’s problems and should only be a measure of last resort considered if Puerto Rico takes significant steps to fix its budget and economic mess,” he writes. The op-ed was timed to coincide with Rubio’s first visit to the island as a presidential candidate. And his position sets him apart from other 2016 contenders, including Jeb Bush and Hillary Clinton, who have supported chapter 9 bankruptcy protection for the deeply indebted island. Read more.

For more on Puerto Rico’s debt crisis, be sure to visit ABI’s “Puerto Rico in Distress” webpage

Commentary: Problems With Supreme Court’s Ruling on Fees

The Supreme Court’s ruling in Baker Botts v. Asarco, which held that Section 330 of the Bankruptcy Code does not itself allow for the reimbursement for time spent defending those fees has drawn a number of criticisms, according to a commentary today by Prof. Stephen Lubben in the New York Times DealBook blog. The opinion does suggest that the Supreme Court does not really understand the dynamics of large chapter 11 cases as the “traditional rule” favored in the opinion arises in traditional litigation, but a chapter 11 case is not traditional litigation, according to Lubben. In response to the court’s opinion, firms have begun to take the obvious and understandable step of putting these “fees for fees” into their retention agreements. Whether that is permissible is the subject of litigation, including two cases pending in the Delaware Bankruptcy Court. Read the full commentary.

For more on the Baker Botts ruling and retention agreements, be sure to register for the October 5 abiLIVE webinar titled “Does it Pay to Be a Bankruptcy Lawyer Anymore? Baker Botts LLP v. ASARCO LLC.” 

Richmond Fed President Makes Case to Raise Interest Rates Now

Richmond Fed President Jeffrey Lacker said today that he had seen enough healing in the U.S. labor market to warrant raising interest rates soon, reported. Lacker, who had advocated for a rate hike in June and will have a vote at the Fed's Sept. 16-17 policy meeting, said the U.S. economy no longer needs interest rates near zero. "It's time to align our monetary policy with the significant progress we have made," Lacker said in prepared remarks titled "The Case Against Further Delay." Click here to read Lacker’s speech.

Lehman Trustee: Former Employees Don't Warrant Special Status

The trustee winding down Lehman Brothers Holding's brokerage says hundreds of former employees still waiting to recover more than $250 million in deferred compensation don't deserve to jump in front of other unsecured creditors in the bankruptcy-payout line, Dow Jones Daily Bankruptcy Review reported today. Lawyers for James W. Giddens, the trustee in charge of unwinding Lehman's brokerage, want to reclassify the employees' secured claims, which receive priority under bankruptcy law's payment scheme, to general unsecured status. Based on analysis by the trustee's counsel, Giddens said in court papers filed on Wednesday that the deferred compensation claims should be reclassified because the former employees don't possess a lien on any Lehman property. Thus, they aren't entitled to secured status under bankruptcy code, the trustee said.

Patriot Coal Union and Suitors Agree on Labor Pact

Patriot Coal Corp. averted a bankruptcy showdown with its miners on Thursday, after the union representing its workers and the company’s proposed suitor agreed on a new employment pact, the Wall Street Journal reported today. Patriot attorney Michael Slade said in bankruptcy court that talks between the company, the United Mine Workers of America union and proposed Patriot buyer Blackhawk Mining LLC yielded an agreement on “material terms” of a new collective bargaining agreement for Patriot’s unionized workers at what would be the post-merger company. Like a similar deal reached with the nonprofit organization hoping to buy a smaller subset of Patriot’s assets, this agreement is subject to ratification by union members. The union will ask its members to vote on the accord once the bankruptcy court has granted Patriot’s request to reject the existing collective bargaining agreements covering miners at Patriot.

Hosted by the Commercial Fraud Committee

This is the first of three webinars stemming from ABI's recently published book Fraud and Forensics: Piercing Through the Deception in a Commercial Fraud Case. Each webinar takes an in-depth look at areas of specialty, challenge and reward for forensic accountants and the professionals who work with them in commercial fraud cases. The second and third webinars will be:

  • Fraud and Forensics: The Expert Witness in a Commercial Fraud Case - December 9, 2015, 1:30 - 2:45 pm ET
  • Fraud and Forensics: The Lawyer and Forensic Accountant Working Together - January TBD

This webinar will highlight important aspects of the investigation phase of a commercial fraud case from the perspective of a forensic accountant. Featuring three authors of the recently published Fraud and Forensics: Piercing the Deception in a Commercial Fraud Case, the presentation will cover different types of commercial fraud and how to detect it, along with the investigative techniques necessary to leverage witness information and the cache of data available on social media outlets. The panelists will also discuss cash-flow analysis, data-collection techniques, and methodologies for creating a database.

October 8, 2015

75 Minutes 1:30-2:45 pm ET


ABI Member
Webinar Bundle (includes all three webinars plus book): $225
This Webinar Only: $75
This Webinar with Book: $125

Webinar Bundle with Book: $345
This Webinar Only: $195
This Webinar Only with book: $245

SPEAKERS for October 8, 2015

Kathy Bazoian Phelps, Moderator
Diamond McCarthy LLP
Los Angeles

Gregory S. Hays
Hays Financial Consulting, LLC

Katya Hirose
FTI Consulting, Inc.
Los Angeles

Maryellen K. Sebold
BDO Consulting
Los Angeles

To register for ALL THREE WEBINARS please click here





Conference Address

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