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bankruptcy upsets divorce divisionThe divorce was over.

The assets were divided by a final judgment.

The house would go to Him, and he would pay Her $75,000 on stated terms.

It was the end of a miserable stretch in their lives.

Only it wasn’t.

Before anyone recorded the judgment of dissolution (that’s Californian for “divorce”), She filed bankruptcy.

And He found out about Bankruptcy Code  §544.

Powers of a bankruptcy trustee

When a bankruptcy is filed, all of the debtor’s assets become part of the bankruptcy estate.

2 weeks 3 days ago

On November 15, 2016, Texas-based Xtera Communications, Inc. and seven of its affiliates filed voluntary petitions for chapter 11 bankruptcy relief in the United States Bankruptcy Court for the District of Delaware (Case No: 16-12577). XTERA is a leading provider of high-capacity, cost-efficient optical transport solutions that it sells to telecommunications service providers. According to the First Day Declaration, the Debtors have experienced significant liquidity issues during the past nine months caused by, among other things, the expiration of certain key contracts. The petition lists between $50 million and $100 million in both assets and liabilities. The Debtor’s stock was delisted from NASDAQ a few weeks ago.

2 weeks 3 days ago

Upcoming Committee Formation Meeting: Tuesday, November 22, 201610:30 a.m.

Case Name: 16-12551 (BLS)

Location: Office of the US Trustee 844 King Street, Room 3209 Wilmington, DE 19801

Notice of Formation Meeting for Official Committee of Unsecured Creditors can be found here.

The petitions for relief and First Day Declaration are available through Prime Clerk.

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

2 weeks 3 days ago

The president-elect should consider establishing an executive-level office to inform his administration on ushering in a new era of financial regulation Â-- one that is much savvier about new technology and big data.

Read More from: BankThink

2 weeks 3 days ago

Receiving Wide Coverage ...

Kid gloves: The Government Accountability Office released its review of the Federal Reserve's annual bank stress tests, which the Financial Times said "may pave the way towards gentler treatment" of banks. "The report recommended that the Fed share more information on the models it uses and its reasons for failing big banks, while working more closely with other agencies including the FDIC and the OCC." ...

Read More from: BankThink

2 weeks 4 days ago

Encanto Restaurants, Inc. v. Luis S Aquino Vidal (In Re Cousins Int’l. Food Corp.), 553 B.R. 197 (Bankr. D. Puerto Rico 2016)) – A Chapter 11 debtor sold two restaurants under a bankruptcy sale order that provided that the sale … Continue reading

2 weeks 4 days ago

No Income Option I recently received an interesting call from young lady who was seeking bankruptcy protection to help with outstanding parking tickets. She had no income whatsoever, so she was not a candidate for chapter 13 bankruptcy which is the repayment plan over a 3 to 5 year period. However, she was interested in+ Read More

The post Will Chapter 7 Bankruptcy Help With Parking Tickets? appeared first on David M. Siegel.

2 weeks 4 days ago

 

Orrick’s Evan Hollander co-authored an article for The Norton Annual Survey of Bankruptcy Law (2016 Edition) addressing unique confirmation issues faced by nonprofit debtors in Chapter 11. The article addresses the applicability of the absolute priority rule, distinctive feasibility issues and appropriate comparators when considering the best interests test in a nonprofit cases. The authors identify emerging trends in nonprofit bankruptcy jurisprudence and suggest legislative action to help clarify certain ambiguities in the law. Read the full article here.

2 weeks 4 days ago

Following the regulatory orders against Wells Fargo and the resignation of its CEO, stockholders are likely to ask whether the board has responsibility and even liability for the bank's compliance failures.

Read More from: BankThink

2 weeks 4 days ago

Today in bankruptcy I taught In re Trump Entertainment ResortsInc. (Bankr. D. Del. Feb. 20, 2015).  The case isn't in my casebook (although some might notice that I presciently included in the problem sets a recurring character named Ronald Grump, a real estate developer with frequent bankruptcy dealings), but I added it to my syllabus this fall because of the election connection.  It was only today, however, that I realized what a hugely important decision it was in retrospect.  

The case involved an attempt by Donald and Ivanka Trump to terminate the debtor's license to use their trademark name, which had been pledged by the debtor as collateral for a loan, despite being nonassignable by its terms.  The Trumps sued in state court to terminated the trademark based on an alleged breach of the license agreement, but the debtor's bankruptcy filing stayed the suit. The Trumps moved to lift the stay.  The bankruptcy court said that the trademark license was an executory contract, and under the hypothetical test for assumption, said that the debtor could not assume the license, and therefore lifted the stay to allow the state court termination litigation to proceed (which I assume resulted in termination).  

Read More from: Credit Slips

2 weeks 4 days ago

On October 11, 2016, the United States Supreme Court granted certiorari to a debt collection agency in its appeal from the Eleventh Circuit case Johnson v. Midland Funding, LLC.[1] In Johnson, the Eleventh Circuit affirmed its decision in Crawford v. LVNV Funding, LLC,[2] which held that a debt collector violates the Fair Debt Collection Practices Act (the “FDCPA”) when it files a proof of claim in a bankruptcy case on a debt that it knows to be time-barred. In view of the emerging circuit split, the Supreme Court agreed to hear the case in order to resolve two issues: (1) whether the filing of a time-barred proof of claim in a bankruptcy proceeding exposes a debt-collection creditor to liability under the FDCPA and (2) whether the Bankruptcy Code, which governs and permits the filing of proofs of claim in bankruptcy, precludes a cause of action under the FDCPA for the filing of a time-barred proof of claim in a bankruptcy proceeding.

Read More from: Hughes Hubbard & Reed

2 weeks 4 days ago

Refusing to let innovators experiment in a permissive environment keeps regulators in the dark, and ultimately, prevents progress in financial services.

Read More from: BankThink

2 weeks 4 days ago

     On May 19, 2015, Clark County Collection Services, LLC ("CCCS"), a Nevada debt collector, obtained a default judgment in Nevada Justice Court against Patricia Arellano on an assigned medical claim of $371.89. Two months later, on July 27, 2015, Arellano filed a class action in federal district court in Nevada, against CCCS and its lawyers, alleging FDCPA violations associated with the state debt collection action.

     A week later, on August 4, 2015, CCCS and its lawyers responded with some creative lawyering. CCCS obtained a writ of execution from the Nevada Justice Court. The writ, stating an amount owing of about $825 (including fees, costs, and interest added to the principal amount of the judgment), commanded the sheriff to levy on the Arellano FDCPA cause of action pending in federal district court. Because Nevada law permits execution on a judgment debtor's pending cause of action against another, the sheriff levied the writ, posted notice of sale once each week, for three consecutive weeks, in the Nevada Legal News, and thereafter held a sale of the cause of action on November 19, 2015. CCCS, likely the only bidder at the sale, purchased the cause of action with a credit bid $250.

Read More from: Credit Slips

2 weeks 4 days ago

The Treasury’s Home Affordable Modification Program, known as HAMP, will sunset on December 30, 2016. HAMP, put in place early in the Great Recession, provides two separate avenues for a homeowner with a qualified mortgage dated prior to January 1, 2009 that is in default or at imminent risk of default to seek a mortgage modification subject to program guidelines.

In order to take advantage of HAMP, a complete application package must be submitted to the participating mortgage servicer handling your mortgage by December 30, 2016.

Although there may be an opportunity to participate if something less than a complete package is submitted by year-end, you should get the papers in early and obtain confirmation that the package is complete as far before 12/30/16 as possible.

HAMP reviews are currently conducted under Bankruptcy Court supervision in the Southern District of New York (in the Poughkeepsie, White Plains and Manhattan divisions) under the Court’s Loss Mitigation program.

It is unclear what may be accomplished to assist the many remaining distressed homeowners who desire a mortgage modification after HAMP; mortgage servicers and consumer advocates have been in discussions about a possible new, voluntary program option. It is likely that in-house (investor) modifications will continue to be available to qualifying borrowers in some instances. Whether those programs will be of significant value to homeowners post-HAMP remains to be seen.

2 weeks 4 days ago

The Trump administration will not approach economic policy like the Federal Reserve does, but the central bank can still address its own problems before the new administration intervenes.

Read More from: BankThink

2 weeks 4 days ago

ice cream float

Trying to spend down cash before filing bankruptcy?

It’s time to talk about the float.

Not the root beer float, though that would be more fun.

The bank “float”:  the period between writing a check and it clearing your bank.

(We’ll talk about what to spend on before filing bankruptcy, too).

When you file bankruptcy, your schedules are supposed to show what you own on that day.  For checking accounts, that’s the balance that the bank shows.

If you’ve written a bunch of checks right before filing, checks still floating out there on their way to the bank make your bank balance higher than the balance in your checkbook.

2 weeks 4 days ago

Receiving Wide Coverage ...

White to leave: Securities and Exchange Commission Chairman Mary Jo White said she plans to step down in January at the end of the Obama administration, "opening the door to a new Republican-appointed leader who could move to loosen rules on Wall Street and curb the aggressive enforcement approach Ms. White prosecuted," in the words of the Wall Street Journal. White is the first major Obama appointee to announce a departure after...

Read More from: BankThink

2 weeks 5 days ago

Attorney Mary PoolYou have several options with a debt that you owe has been placed in collections.  This blog post will help you determine whether one of these options will work for your situation and explain the consequences that could occur if you are unable to choose either of these options at this time.  Usually, when you owe a creditor, it will first bill you multiple times to attempt to get you to pay them directly.  Depending on what type of debt that you owe, you may have some options here to get this debt settled before the creditor turns it over to a third party debt collector.

If You Can’t Pay the Debt

If you are dealing with an original creditor, you can attempt one of the following methods if you are unable to pay the debt in full:

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

2 weeks 5 days ago

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Illusions

By: Donald L. Swanson

We all make assumptions — every day — about many things.  Our false assumptions are our illusions.

There are many illusions about mediation, most of which place restrictions on the role and effectiveness of the mediation process.  We all have them.  Fortunately, we now have solid evidence to dispel some of them — courtesy of the U.S. Circuit Courts of Appeals.

The U.S. Circuit Courts of Appeals have been conducting formal mediation programs for decades.  The earliest began in the mid-1970s.  And the Circuit Courts have been studying the impact and effectiveness of those programs for years.

Read More from: Mediatbankry

2 weeks 5 days ago

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