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Since Marblegate was decided in 2014, the only court to address claims under §316(b) of the Trust Indenture Act (“TIA”) in the context of a corporate restructuring transaction is CaesarsCaesars and Marblegate interpreted §316(b) broadly, finding that it protects not only the legal right to payment but also the practical ability to receive principal and interest where an out-of-court restructuring renders repayment a practical impossibility.  This week’s decision by the Southern District of New York in Cliffs Natural makes clear that the holdings in Marblegate and Caesars are limited to comprehensive restructurings that amount to de facto bankruptcies in which two factors, at least, are present: (1) an asset transfer; or (2) the removal or material modification of inter-company guarantees or security interests. The court’s characterization of Marblegate and Caesars, and their progenitor Mechala, emphasized that in each, noteholders were left with “no practical ability to receive payment.”

11 hours 59 min ago

US Supreme CourtIn a prior post, we discussed the Third Circuit Court of Appeals’ decision in Jevic Holding Corp., where the court upheld the use of so-called “structured dismissals” in bankruptcy cases, and the Supreme Court’s grant of certiorari.  Yesterday, the Supreme Court heard oral argument in Jevic.  The Court’s ultimate ruling will likely have a sig

Read More from: eSQUIRE Global Crossings

12 hours 3 min ago

The gender equality police Â-- namely, the activists Arjuna, Pax, and Trillium, which targeted Silicon Valley earlier this year Â-- is making moves on Wall Street now, starting with Citigroup, Bank of America and Goldman Sachs. Fed governor Lael Brainard encourages fintechs to tackle financial access and Cleveland Fed president Loretta Mester talks about the industry's past and future. Citi FinTech's Carey Kolaja celebrates its first product launch. Plus, people moves at Santander Consumer, Deutsche Bank and Bank of New York Mellon.

Read More from: BankThink

14 hours 36 min ago

The bank must make fundamental changes to avoid becoming the ultimate scapegoat for grievances about Wall Street's biggest banks.

Read More from: BankThink

14 hours 51 min ago


3799375512_4878094ffd_zBanks do funny things when a customer files bankruptcy.

Only many are not so funny.

Whether your relationship with your bank has been good or not, there may be grounds for divorce before you file your bankruptcy case.

Or at least consider whether there are grounds for a separation.

Set off

Your bank owes you the money you’ve deposited with them.  Heady to think of Bank of California as being in your debt, eh?

If you owe them money on a personal loan or a car loan, you are their debtor.

The bank has the right under common law to take what it owes you to pay what you owe them.

That’s called set off, or sometimes, off set.

17 hours 17 min ago

U.S. banks are smart to take their time in embracing a model that cedes space to nonbank competitors and could put consumers more at risk for identity theft.

Read More from: BankThink

17 hours 21 min ago

Receiving Wide Coverage ...

Big brother: Credit Karma and Mint are ready to offer automated tax preparation services as part of new features "that will make them feel more like link" target="_blank">robotic financial advisers, tapping customers on the shoulder when they could make better financial decisions," as the New York Times puts it. Credit Karma said Wednesday it acquired AFJC Corp., an online tax preparation and filing company, and would begin offering its services, called Credit...

Read More from: BankThink

18 hours 4 min ago

Bankruptcy and your tax returnUsually, we’re touting pre bankruptcy planning:  know what’s exempt, what debts will survive bankruptcy, and arrange your affairs to lose as little as possible to a bankruptcy trustee.

There’s one bit of tax and bankruptcy planning that you can do after you file bankruptcy.  That’s despite the fact that bankruptcy is generally a snapshot of what you own and what you owe on the day you file the case.

Bankruptcy trustees will claim a percentage of the current tax year’s refund, payable to the trustee when the debtor receives it, long after the bankruptcy case is filed.

18 hours 12 min ago

The filing of a bankruptcy case typically precludes an unsecured creditor – such as a trade vendor – from having its prepetition claim satisfied in full. While this general principle holds true in most instances, the Bankruptcy Code provides certain remedies that mitigate the harm to unsecured creditors. Once such remedy arises in Section 546(c), which recognizes valid state law reclamation claims in the context of a bankruptcy case. The concept of reclamation is rather straight-forward. Subject to the rights of a secured creditor with a security interest in such goods or proceeds thereof, a seller that has sold goods to the debtor in the ordinary course of the seller’s business can reclaim those goods if: (i) the debtor received the goods while insolvent and within 45 days of the commencement of the bankruptcy; and (ii) the seller timely makes a written demand for reclamation. See 11 U.S.C. § 546(c). The Problem Reclamation claims for goods sold are subject to prior rights of a secured creditor with a security interest in such goods or the proceeds of such goods. For example, the vast majority of bankrupt business debtors have secured creditors with blanket security interests against all of their assets. Left unsatisfied, unsecured vendors will often find their reclamation claims trumped by the claims of senior secured creditors because the secured creditors’ security interests are prior to the reclamation claimants’ rights.

Read More from: Bernstein-Burkley, P.C.

19 hours 26 min ago

1899 Treatise (1st Edition)

By: Donald L. Swanson

Original-source documents from antiquity are always fascinating!  They provide a wealth of historical information and a wealth of insight into life in an earlier day.

It’s mind-boggling, for example, to read the words of an author, who lived in an ancient time, writing about events of “ancient days” from his/her perspective-in-time.

A treatise on U.S. bankruptcy laws, published in 1899, is one of these original-source documents from antiquity.  And it is a splendid illustration of the wealth of information and insight (and the mind-boggling historical information) that such documents can provide.

Read More from: Mediatbankry

20 hours 10 min ago

Bankruptcy newsWell, updating the last post, Teresa Giudice won the motion to approve the settlement splitting proceeds of her yet to conclude malpractice lawsuit against her bankruptcy attorney with her creditors. What’s the Bankruptcy News? Rowan & Martin’s Laugh In TV had a weekly sketch: “What’s the news?” so that is why I stuck the picture [...]

The post Consumer Bankruptcy Updates appeared first on Detroit Bankruptcy Lawyer Kurt O'Keefe.

Read More from: Stop Creditor

20 hours 43 min ago

iStock_000000123381_MediumThe recent successful appeal in Brooks and another (Joint Liquidators of Robin Hood Centre plc in liquidation) v Armstrong and another [2016] EWHC 2893 (Ch), [2016] All ER (D) 117 (Nov) has clarified and highlighted the complexities of bringing a wrongful trading claim and the importance of correctly quantifying losses for which directors can be

Read More from: eSQUIRE Global Crossings

21 hours 6 min ago

The Supreme Court heard oral argument today in Czyzewski v Jevic Holding Corp, which presents the question of the power of a bankruptcy court to approve a settlement that effects a distribution of proceeds of property of the estate that does not follow the absolute priority rule.  $1.7 million of distributions in this case skipped over the priority unsecured claims of the petitioners, and went to the general unsecureds.  The Third Circuit held that a court could approve such a settlement given extraordinary circumstance, which followed the lead of the Second Circuit (Iridium), but conflicted with the Fifth Circuit (Aweco), which is why the Court took the matter on.  

As an initial matter, there was some confusion about the relationship between the question presented, which covers a settlement that violated the absolute priority rule (a question on which there was a conflict in the circuits), and the emphasis on this case being a "structured dismissal" such that the distribution occurred only at the end (implying that there is no conflict in the circuits about the terms of a structured dismissal, and a dispute over that question might not have been granted cert).

Read More from: Necessary and Proper

1 day 10 hours ago

Resistance is Futile.The holiday season has rolled around once again and regardless of whether you are in bankruptcy, this season tends to be a season of stress instead of joy. Americans continue to focus on purchases geared towards their wants instead of their needs. This pattern of spending is exactly what creditors prey on to increase their profits.  They spend money designing advertising to convince you through guilt that you really can afford to spend thousands of dollars for unnecessary Christmas gifts.  The creditors do not care you are struggling to keep a roof over your head, pay your student loans,  and put food on the table all while continuing to pay for your health insurance.   The sole goal of the creditor this holiday season is to increase their money by taking yours.

Read More from: Bankruptcy Law Network

1 day 11 hours ago

There's no denying we are in a mobile-first era. But banks must overhaul their online banking to reap long-term profitability.

Read More from: BankThink

1 day 14 hours ago

In a recent Practice Note with Practical Law, H. Jeffrey Schwartz and I discuss some of the collateral consequences that claim filers may face in a chapter 11 case and related matters, as well as some of the considerations that they may take into account in determining whether and how to file a proof (or … Continue reading

The post Should I File a Proof of Claim in a Chapter 11 Case? appeared first on Robins Kaplan Trial Attorneys Blog.

1 day 15 hours ago


consumer bankruptcyI didn’t expect insight on our national political upheaval at a bar association holiday luncheon.

But the more I think, the more I believe bankruptcy specialist Norma Hammes hit on something in her remarks.

In consumer bankruptcy, she pointed out that we see endlessly the consumer getting screwed by laws written by and for big business.

1 day 16 hours ago

A Republican president and GOP-controlled Congress have the opportunity to disentangle the current regulatory web that leads to overlapping jurisdiction and duplicative rules.

Read More from: BankThink

1 day 17 hours ago

Receiving Wide Coverage ...

Paying the piper: Wells Fargo CEO Timothy Sloan reiterated that the bank expects to spend tens of millions of dollars on investigations and other regulatory matters in the wake of its phony accounts scandal. "I think that seems reasonable today based on what we know. It's the upper end of our range from an efficiency standpoint," he said at a Goldman Sachs financial services conference Tuesday. He also said the scandal could...

Read More from: BankThink

1 day 18 hours ago

Edwards Family P’ship v Dickson, 821 F.3d 614 (5th Cir. 2016) – Prior to bankruptcy the debtor obtained loans from two lenders totaling $16 million that were guaranteed by its CEO. After the debtor defaulted and filed bankruptcy, the lenders … Continue reading

1 day 19 hours ago