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Series: Business Owner Basics 2015 This webinar will discuss the nuts and bolts of employee benefits. The expert panel will teach the basics of today’s benefit law. Read more here.
6 hours 45 min ago
Monday is Labor Day.  That means that the next three days are not only your last opportunity to wear white, but also the perfect time to enjoy the Weil Bankruptcy Blog’s last bit of Bankruptcy Beach Reading.  To help you pass the time and forget that “summer’s almost gone” and “winter is coming,” check out the shortlist of our favorite colorful bankruptcy quotes from the last few months.  Creditors Behaving Badly In re Experient Corp., 2015 WL 4868783 (Bankr. D. Colo. Aug. 12, 2015) (Romero, C.J.) The Honorable Michael Romero signals where he is going at the outset of his decision, which starts, “‘Life imitates art.’  The within dispute is reminiscent of Moby Dick, where Herman Mellville describes Captain Ahab’s self-destructive obsession to destroy a whale that had injured him in the past.” Judge Romero’s decision is full of literary allusion: Like Captain Ahab, the Randall Creditors have been obsessed with pursuing Experient into oblivion. . . . To phrase it plainly, the Court is unpersuaded by each of their objections to confirmation, and much like the fate of Captain Ahab, the objections to confirmation raised here are destined for the bottom of the deep blue sea. Postscript
6 hours 47 min ago
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 reports. The deal still needs a vote of approval from union members. (Daily Bankruptcy Review is a daily newsletter with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial, visit our homepage, scroll to the bottom and click “try for free.”) A lawyer for gunmaker Colt Defense LLC said that company officials are making progress in negotiations with bondholders on deal that would get the company, which struggled after losing U.S. military contracts, out of bankruptcy. Read the Daily Bankruptcy Review story in the Journal. Two former board members of Saab Automobile were accused by Swedish prosecutors of entering into a fake wholesale agreement a few months before the car maker went bankrupt in 2011, WSJ reports.

Read More from: WSJ.com: Bankruptcy Beat

7 hours 8 min ago
Authored by J. Ellsworth Summers, Jr. and Armando Nozzolilloand J. Ellsworth Summers, Jr. and Armando Nozzolillo of Rogers TowersAs mentioned in previous posts, filing an involuntary bankruptcy petition could subject a petitioning creditor to extensive attorneys’ fees and costs. In the final installment of the “Involuntary Bankruptcy 101” series, this post reviews a recent Eleventh Circuit decision posing major pitfalls for creditors hoping to collect on their debts.

Read More from: Florida Banking Law Blog

7 hours 29 min ago
In a prior post, we discussed the ruling of the Northern District of California Bankruptcy Court in the In re Howrey LLP case, whereby the Court found that claims for unpaid rent of landlords of an involuntary debtor were entitled to priority status. Recently, the creditors’ committee in the Howrey bankruptcy case appealed the decision.  Stay tuned for further updates on this matter. Carl D. Neff is a partner with the law firm of Fox Rothschild LLP.  Carl is admitted in Delaware and regularly practices before the United States Bankruptcy Court for the District of Delaware. You can reach Carl at (302) 622-4272 or at cneff@foxrothschild.com.
8 hours 51 min ago
The doorbell rings, and there’s a strange guy standing there. He asks for you by name, hands you some documents, and walks away. Congratulations, you’re being sued. It’s a story that plays out thousands of times a day. People fall behind on credit card debts, can’t pay the collectors, and find themselves named as defendants in collection lawsuits. This happens so often that some law firms do nothing but sue consumers for past due debts. Huge operations, these firms file thousands of lawsuits every day. Suing For Credit Card Debts Is Big Business The business model is simple – file a lot of collection lawsuits with the expectation that most people will do nothing so the law firm can get a default judgment. With a default judgment in hand, the collection lawyer can force payment through wage garnishments, bank account levies, and more. It’s a profitable model for these collection lawyers. In fact, nearly 98% of all people who get sued for a credit card debt take no action whatsoever. Some people are confused about what to do, others simply shrug and figure there’s nothing they can do. A few end up filing for bankruptcy to either wipe out the debt or pay it off over time. Doing Nothing Is A Terrible Idea
13 hours 1 min ago
Interesting article in Bloomberg Business regarding Consumer Financial Protection Bureau (CFPB) “a record 26,704 complaints were registered in July, up 15 percent from the previous month and up 20 percent from a year ago. The CFPB regulates a wide range of consumer financial products, with the notable exceptions of investments and insurance. Debt collectors inspire the most complaints, followed by problems with credit reports and with mortgages. Rather than once again calling customer service and waiting on hold, people can complain to the CFPB online or over the phone. Within days, those complaints are reviewed and routed to companies electronically. Companies must respond within 60 days.Read more.. NOTE FROM DIANE: Bullies can only be stopped by standing up to them.  Banks, credit collection companies and the like have lost all sense of responsibility or accountability when it comes to collecting debts.  In the four years that CFPB has existed it has done more to quash creditors and collection companies abuse of consumers and downright fraud than any governmental organization.
19 hours 43 min ago
Persons in Chapter 13 generally keep all of their property, whether or not it is exempt, but they make regular payments on their debts out of the money that they earn after filing the bankruptcy case. These payments must be at least as much as would have been paid to creditors in a Chapter 7 bankruptcy. (this is called a liquidation analysis)  The payments are made to a trustee, who distributes the payments to the creditors. The payments are made in regular installments, according to a plan that the debtor draws up, with the help of an attorney. If a person does not have enough excess income to make a payment, they may want to consider Chapter 7 bankruptcy. The plans last either until the debts are paid in full or until the end of a three to five year period. The debtor receives a discharge at the end of the plan. Before filing Chapter 13, debtors are required to complete a credit counseling session with an approved counseling agency.
22 hours 57 min ago
Sovereign debt has traditionally been contrasted with corporate debt. Unlike corporations, sovereigns are immune from suit and asset seizure. Unlike corporations, sovereigns can't reliable promise a lender that it will have seniority over other lenders. Unlike corporations, sovereigns can't access bankruptcy. These and other distinctions drive much of the policy and academic thinking about sovereign debt. But perhaps there are also lessons to be learned from consumer lending. This new paper by Susan Block-Lieb at Fordham (abstract below) suggests that consumer debt may be a more helpful analogy, one with important policy implications. In both the sovereign and consumer context, she points out, lending is primarily income- rather than asset-based. In both contexts, restructuring is difficult primarily because income-based lenders cannot easily distinguish borrowers who will not pay from those who cannot pay. And in both contexts, there are substantial and cumulative incentives towards over-borrowing and over-lending.

Read More from: Credit Slips

23 hours 7 min ago
In resolving a motion for leave to file an amended complaint to add new claims, the United States Bankruptcy Court for the Southern District of New York in Hosking v. TPG Capital Management, L.P. (In re Hellas Telecommunications (Luxembourg) II SCA) delved into a complex analysis of English and Luxembourgish (yes, that’s a word) insolvency law, and concluded that while two of the English fraud-based claims could proceed, the Luxembourgish claim allowing creditors to attack fraudulent transactions could not. 
1 day 20 min ago
Actor Nicholas Hoult visits the Infiniti Red Bull Racing garage during qualifying for the Canadian Formula One Grand Prix in Montreal in June.
Mark Thompson/Getty Images
The Hollywood company backing “Collide,” a thriller directed by Eran Creevy and starring Nicholas Hoult, Felicity Jones and Anthony Hopkins, is urging a bankruptcy judge to let it part ways with Relativity Media LLC, which filed for bankruptcy in July. In court papers filed Wednesday with the U.S. Bankruptcy Court in Manhattan, IM Global Film Fund LLC says Relativity hasn’t held up its end of a distribution deal, which includes spending at least $25 million to promote the film and ensuring its release on more than 2,000 theater screens. A spokesman for Relativity declined to comment Thursday. IM Global entered into an exclusive licensing deal with Relativity last year, court papers show.  The film, formerly known as “Autobahn,” was due to be released Oct. 30.

Read More from: WSJ.com: Bankruptcy Beat

1 day 1 hour ago
  In a chapter 11 case, which would appear to also apply in chapters 12 and 13, the 11th Circuit ruled that a creditor was entitled to the default interest rate under a cure and reinstate mortgage.   In re Sagamore Partners, Ltd., No. 14-11106, 2015 WL 5091909 (11th Cir. Aug. 31, 2015).  The case involved a loan on a hotel wherein the original interest rate was 6.54%, but increased to 11.54% in the event of a default, defined as missing any regularly scheduled payment.  No notice of default was required under the contract.   The borrower did not make the September 2009 payment, and the lender sent a letter declaring the debt in default on 28 September 2009, as well as accelerating the debt in September 2009.   A foreclosure was commenced in December 2009, and a chapter 11 bankruptcy filed in October 2011, with a chapter 11 plan proposing to cure and “nullify[ ] all consequences of any alleged default” by paying the accrued pre-default-rate interest.  Id. at *2.   The Bankruptcy Court initially found that default interest rates were proper if they were valid under the agreement and applicable non-bankruptcy law, and if they should not be excused.  However, it ultimately ruled against the lender finding that the notice of default was defective precluding allowance of the default rate, or that it was waived by the lender's request for late fees.

Read More from: Tampa Bankruptcy

1 day 5 hours ago
Sarah Frankel has launched the525group, a recruitment firm for professional services firms in the bankruptcy and restructuring industry. Ms. Frankel, a board adviser at the International Women’s Insolvency & Restructuring Confederation, has also been on the board of the Turnaround Management Association. She has experience as a business development adviser. Alexander Rohan joined the restructuring advisory group of Guggenheim Securities, the investment banking and capital markets group of Guggenheim Partners, as a managing director. Mr. Rohan, who earned his law degree from the New York University School of Law, has experience as an auditor and as a bankruptcy attorney. He most recently worked as a managing director of Jefferies’s recapitalization and restructuring group.

Read More from: WSJ.com: Bankruptcy Beat

1 day 5 hours ago
Series: What do you do when your client is involuntarily pushed into bankruptcy? When should you push someone else’s client into an involuntary bankruptcy? What happens once an involuntary case is filed? This webinar will cover everything you ever wanted to know about involuntary bankruptcy petitions but were afraid to ask. Read more here.
1 day 6 hours ago
In this July 29, 2015 photo, the U.S. flag flies in front of Puerto Rico
Ricardo Arduengo/Associated Press
Puerto Rico’s power authority and a group of bondholders agreed on a debt restructuring plan to deal with the utility’s $9 billion in debt—an important step in the island commonwealth’s efforts to improve its finances, The Wall Street Journal reported. (Daily Bankruptcy Review is a daily newsletter with comprehensive coverage and analysis of emerging and in-progress insolvencies and turnarounds. For a two-week trial, visit our homepage, scroll to the bottom and click “try for free.”) Vendors are demanding cash upfront from concert promoter SFX Entertainment Inc. in the wake of the company’s abandoned effort to go private, The Wall Street Journal reported.

Read More from: WSJ.com: Bankruptcy Beat

1 day 6 hours ago
Starting salaries for professionals working at U.S. companies are expected to increase an average 4.1 percent next year, according to a study released Thursday by staffing firm Robert Half.  That’s the good news. This forecast comes on the heels of an Economic Policy Institute (EPI) study finding that American workers’ productivity continues to grow much faster than their pay. Read more here.
1 day 7 hours ago
Just about everyone who files for bankruptcy worries that they’ll never get a mortgage. It’s not true – in fact, it’s never been true. That’s not to say you can go from the bankruptcy court right to the mortgage broker, either. You’ve got to take steps to rebuild your credit standing, save for a down payment, and stabilize your income in order to qualify for a mortgage. Until recently, Fannie Mae had a waiting period of 4 years between the time a Chapter 7 or 11 bankruptcy case finished and when you could qualify for a mortgage. Chapter 13 cases had a waiting period of 2 years after discharge, or 4 years if the case was thrown out of court. The Federal Housing Authority loosened their standards a few years back, and now the government controlled mortgage giant will do the same. According to The Mortgage Reports:
1 day 12 hours ago
Lake Geneva, WI – September 3, 2015 – Wynn at Law, LLC, a Southeastern Wisconsin law firm, announces the expansion of its Wisconsin legal team with a new appointment. According to Shannon Wynn, Principle of Wynn at Law, LLC, “The law firm is growing, and our clients are asking for additional services. Thus, Wynn at Law, LLC needed to grow in order to meet our clients’ demands. On the heels of opening several new office locations, we have started to build our team. With the expanded team, we will continue to build our expertise and expand our service areas. Our highly skilled legal team allows us to deliver desired results with the attention to service that our clients need and deserve.”

Read More from: Wynn at Law, LLC

1 day 15 hours ago
Since the time of our last post on August 24, 2015, Alan D. Halperin, the Trustee of the FBI Wind Down, Inc. Liquidating Trust has filed 94 additional preference complaints seeking to avoid and recover alleged preferential transfers pursuant to Sections 547 and 550 of the Bankruptcy Code. Defenses to a Preference Action Preference actions are a form of litigation specifically provided for by the Bankruptcy Code which are intended to recover payments made by the Debtor within the 90 days prior to declaring bankruptcy.  Recognizing that these payments aren’t always made for inappropriate reasons, the Bankruptcy Code provides creditors with many defenses to preference actions. Included among these are the “ordinary course of business defense” and the “new value defense.” For reader’s looking for more information concerning claims and defenses in preference litigation, attached is a booklet that we have prepared on the subject: “A Preference Reference: Common Issues that Arise in Delaware Preference Litigation.”
1 day 18 hours ago
On September 2, 2015, Hulu announced that it would offer an ad-free level of its popular streaming service. This prompted a lot of my Facebook friends to start talking about cutting their cable service. According to the company’s press release:
Viewers now have the choice to watch Hulu commercial free for $11.99 per month or with limited commercials for $7.99 per month. Current Hulu subscribers will maintain their existing subscription, but will have the choice to switch to the commercial-free option at any time for an additional $4 per month. For viewers who choose to watch content with limited commercials, Hulu will continue to show fewer commercials than scheduled television.
With so many options out there for getting your favorite shows on demand, is there any reason to keep paying for cable or satellite TV? For years I’ve watched my clients struggle with cable bills that come to well over $200 each month, draining their wallets for the privilege to do the same things we used to get for free – watch television.
1 day 22 hours ago

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