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Section 1104(a)(2) of the Bankruptcy Code provides for the appointment of a chapter 11 trustee “if such appointment is in the interests of the creditors, any equity security holders, and other interests of the estate . . . .”  While it is not often that we see a court displace management pursuant to section 1104(a)(2), it does happen on occasion.  One such recent case is In re China Fishery Group Limited. Case No. 16-11895 (Bankr. S.D.N.Y. Oct. 28. 2016), where Judge James L. Garrity, Jr. determined that a debtor’s fishy treatment of its anchovy business warranted the appointment of a chapter 11 trustee. 

Background

12 hours 18 min ago

It doesn’t happen very often, but sometimes a client who needs to file bankruptcy is also in line to receive an inheritance.  Like a lot of things, what will happen to that inheritance in a bankruptcy case depends on the timing.

When you file a bankruptcy case, all your assets form what we call a “bankruptcy estate,” which is similar to a probate estate.  It’s a way of describing the class of things that a Chapter 7 trustee can sell (if there are no liens or exemptions), or that a Chapter 13 trustee will count to determine the fairness of your payment plan.  This post will deal with the affect of an inheritance in a Chapter 7 case, because your options in Chapter 13 are different, and include simply dismissing your case.

Read More from: Bankruptcy Law Network

15 hours 52 min ago

Piloting distributed ledger technology is important. However, banks need to temper expectations regarding the returns.

Read More from: BankThink

16 hours 43 min ago

 

bankruptcy means test trick

If the most useful trick for beating the means test involves projecting health care expenses, the second most useful trick involves taxes.

Tax troubles drive the filing of a large percentage of bankruptcy cases these days.  It makes sense:  bankruptcy is a powerful tax tool and a  bankruptcy judge can be a good ally when facing the IRS.

Even people who don’t currently owe back taxes often court tax trouble to pay other debts:  they reduce their withholding to free up money to pay credit cards.

17 hours 47 min ago

bankruptcy-attorney-brad-botesWe get calls from people almost every day asking how much we charge to file bankruptcy. They have apparently already decided, perhaps upon the advice of a friend or family member, that they need to file bankruptcy and are making their way through a list of law firms asking this question alone to determine who they can pay the least to be the caretaker of their financial future. Now think about this for a moment. The person’s finances are at a point where they feel that they have no option but to file bankruptcy and they are making a decision on who to hire to help them based upon which attorney will charge the least. Worst yet, there are apparently attorneys who will quote a fee for handling an important legal matter without knowing anything more about a person than what they learn in a 30 second phone conversation.

Read More from: Bonds & Botes, P.C.

18 hours 7 min ago

With the anti-globalism sentiment growing in parts of Europe and the U.S., a "my country first" approach to international bank regulation will hurt financial institutions and their local economies.

Read More from: BankThink

19 hours 13 min ago

Receiving Wide Coverage ...

It's official: Wells Fargo has formally separated the roles of CEO and chairman under pressure from some large investors, including several state treasurers, according to the Financial Times. John Stumpf, the bank's former chairman and CEO, resigned in October following the bank's phony accounts scandal and was replaced by Timothy Sloan as CEO and Stephen Sanger as chairman. But on Thursday Wells went further, amending its bylaws to mandate the split. "Wells'...

Read More from: BankThink

20 hours 19 min ago

 

Recently, the Third Circuit reversed decisions issued by the Delaware Bankruptcy and District Courts and permitted first and second lien noteholders of Energy Future Intermediate Holding Company LLC and EFIH Finance Inc. to receive payment of a make-whole premium. In re Energy Future Holdings Corp., No. 16-1351 (3d Cir. Nov. 17, 2016).  The decision, which is largely grounded in New York law, departs from recent controversial decisions issued by the Bankruptcy Court and District Court for the Southern District of New York in the Momentive bankruptcy, which we have previously discussed here and here.  In Momentive, the courts reached the opposite conclusion on substantially similar facts.  In Momentive, the courts reached the opposite conclusion on substantially similar facts.  In addition to creating a split between the Third Circuit and the Southern District of New York, the ruling creates uncertainty regarding the ability for the debtors in the long-running EFH bankruptcy to confirm their proposed chapter 11 plan.

Background

1 day 12 hours ago

Citi's Debby Hopkins is retiring at the end of this year and Fidelity's Abigail Johnson is taking over for her father as its new chairman. Beth Mooney, Morgan Cambern, Claire Calmejane, and other execs talk about the impact fintech has had in their jobs and why technology should be embraced and not feared. Meanwhile, Citi faces a suit from a former trader over its alleged "Bro's Club" practices.

Read More from: BankThink

1 day 14 hours ago

The smallness of in-store branches used to be a liability, but with the industry's changing landscape, strategically-placed "alternative branches" make more sense today.

Read More from: BankThink

1 day 16 hours ago

Upcoming Committee Formation Meeting: Wednes., December 7, 2016, 10:00 a.m.

Case Name: 16-12634 (LSS)

Location: The Doubletree Hotel 700 King Street Wilmington, DE 19801

The Notice of Formation Meeting for Official Committee of Unsecured Creditors can be found here.   View the debtor’s press release for further details.

Contact Norman L. Pernick and  Nicholas J. Brannick for more information.

1 day 18 hours ago

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Just about every year changes are made to the rules that govern how bankruptcy cases are managed — the Federal Rules of Bankruptcy Procedure. The revisions address issues identified by an Advisory Committee made up of federal judges, bankruptcy attorneys, and others.

1 day 19 hours ago

Some regulatory agencies appear ripe for criticism or curbs to their authority in the incoming Trump administration, but the Office of the Comptroller of the Currency is in position to have its authority expanded.

Read More from: BankThink

1 day 19 hours ago


Remember the kid’s geography game, Where in the World is Carmen Sandiego?

Clues took players all around the world to stop a gang of thieves.

When it’s debt you want to stop, if you’ve moved around in the past two or three years, the rules of the game are not child’s play.

Two issues are in play.  One concerns which courthouse your bankruptcy case is filed in.  The second is what state’s  exemptions can you use.

1 day 19 hours ago

Receiving Wide Coverage ...

Mnuchin speaks: Steven Mnuchin discussed his views on regulatory and tax policies Wednesday after being named President-elect Trump's designated Treasury secretary. Speaking on CNBC, Mnuchin said he would focus on rolling back parts of the Dodd-Frank financial reform law. "The number one problem with Dodd-Frank is that it's way too complicated and cuts back lending," he said, adding, stripping back part of the law "will be the number one priority on the...

Read More from: BankThink

1 day 20 hours ago

Attorney Grant McNuttMany of my clients come to me six months after cashing out their 401(k).  At the time, it seemed to be a good idea to solve a short-term cash crunch.  Unfortunately, cashing in a 401(k) can cause problems in the future.  It is often easy to cash in your 401(k) as long as you can prove you are having a hardship, such as temporary cash-flow problems created by the loss of a job or an emergency home repair.  Sometimes I hear they have simply paid down a credit card or caught up a loan, with no ability to pay the very next month.  In essence, they have put a band aid on their financial situation that often times awakens only a few months later.  Also, in the panic of cashing in the 401(k), it probably came as a surprise that 20% or more is paid in taxes plus another 10% in early pay out penalties.  So the $3,000.00 they thought they were getting ended up barely $2,000.00.  If you

Read More from: Bonds & Botes, P.C.

1 day 20 hours ago

img_1684By: Donald L. Swanson

Mediation needs to be included — explicitly and by name — in the Federal Rules of Bankruptcy Procedure.

Mediation Authorization and Confidentiality

The new mediation provision must cover two specific subject areas: (i) mediation authorization, and (ii) mediation confidentiality.

Authorization.  If a city is a Chapter 9 debtor in a jurisdiction without local mediation rules, does authority exist to appoint a mediator?  What if the bankruptcy judge wants to appoint a proactive mediator team, like Detroit: does the judge have authority to do so?

Such questions could be resolved affirmatively by a Federal bankruptcy rule.

Read More from: Mediatbankry

1 day 21 hours ago

Theresa Giudice’s bankruptcy keeps on providing blog fodder – for me and other bankruptcy attorneys. Bankruptcy Settlement of Reality TV Star This is just too juicy.  Not from a salacious point of view, but, so many legal issues in this hot mess of a case. I blogged earlier about her bankrupt Teresa Giudice blaming her [...]

The post Bankruptcy Settlement of Reality TV Star – Being Challenged appeared first on Detroit Bankruptcy Lawyer Kurt O'Keefe.

Read More from: Stop Creditor

1 day 23 hours ago
Posted by Kathy Bazoian Phelps

Below is a summary of the activity reported for November 2016. The reported stories reflect: 6 guilty pleas or convictions in pending cases; over 37 years of newly imposed sentences for people involved in Ponzi schemes; at least 3 new Ponzi schemes worldwide; and an average age of approximately 50 for the alleged Ponzi schemers. Please feel free to post comments about these or other Ponzi schemes that I may have missed. And please remember that I am just relaying what’s in the news, not writing or verifying it.

Gino Franciesco Accettola, 49, was accused in a lawsuit of running a Ponzi scheme.  Accettola told clients that he was a builder who could provide large returns for investors in his construction projects. The lawsuit alleges that 11 victims lost more than $3.7 million.

Read More from: The Ponzi Blog

2 days 11 hours ago

In early November, the Ninth Circuit held in In re New Investments, Inc. that a debtor was required to “cure” defaults to an agreement using a post-default interest rate, overturning its prior, decades-old decision In re Entz-White Lumber & Supply, Inc., which had held that a debtor could cure agreements at pre-default interest rates.

Background

New Investments, Inc. (“New Investments”) borrowed approximately $3 million from Pacific L 51, LLC (“Pacifica”) to purchase hotel property.  The loan accrued interest at a five percent rate which would increase to thirteen percent after an event of default.  New Investments defaulted in 2009 and filed for chapter 11 relief thereafter.  In the bankruptcy case, New Investments’ plan of reorganization proposed to “cure” the default under the loan agreement by selling the hotel property and using the proceeds to pay Pacifica at the pre-default interest rate of eight percent.  Pacifica objected to the plan by arguing that it was entitled to the higher post-default interest rate of thirteen percent.

The bankruptcy court confirmed New Investments’ plan over Pacifica’s objection and Pacifica timely appealed directly to the Ninth Circuit Court of Appeals.

2 days 13 hours ago

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