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By Donald L. Swanson Judge Gerald E. Rosen and Attorney Eugene Driker, mediators in the Detroit bankruptcy case, published this guest article in the Detroit Free Press on January 18, 2015.  Here are some excerpts from the article: –“Mediation works, and can produce great benefits much more efficiently and expeditiously than other approaches.” –“Four ingredients were consistently the key to success: candor, cooperation, creativity and courage.” –“There were no instruction books or road maps to guide the parties or the mediators on how to solve many of the unique issues in this unique bankruptcy, but the creative juices flowed and produced agreements that benefited everyone.” –“Cooperating with the ‘other side’ and looking for creative solutions required a healthy dose of courage on the part of many to move away from entrenched positions and try novel concepts, courage that was on full display and contributed greatly to the outcome that Judge Rhodes in his confirmation decision called ‘miraculous.’” Action Item.  These are wise words.  We should all take them to heart. #bankruptcy   #mediation   #bankruptcymediation   #detroitbankruptcy

Read More from: Mediatbankry

1 day 4 hours ago
Zloop Inc., a North Carolina recycler, was having a rough 2014. It needed cash, and an investor was suing the company and Chief Executive Robert Boston for overpromising on revenue expectations. So maybe the company shouldn’t have spent heavily on the stock-car racing career of Mr. Boston’s son, a bankruptcy-court watchdog said. In the 20 months before filing for bankruptcy, Zloop spent roughly $1.7 million for a Kyle Busch Motorsports racing-sponsorship deal that made Mr. Boston’s son, Justin, the lead driver. “More money was spent on furthering the professional racing career of Mr. Boston’s son than in any other part of operating this business during 2014 and 2015,” Justice Department lawyers who asked Judge Kevin Carey to put new leaders in charge of the company. Justice Department officials slammed Mr. Boston and co-founder Robert LaBarge in a recently filed court document, saying they spent more than $2.7 million of Zloop’s money since 2014 on items that had nothing to do with its recycling operations. Zloop, founded in 2012, uses machines that break down old electronic equipment like computers, TVs and stereo systems and sort out sellable bits of copper, silver, gold, memory chips and other parts. A Zloop lawyer declined to comment on the Justice Department officials’ criticism.

Read More from: WSJ.com: Bankruptcy Beat

1 day 6 hours ago
The recent decisions in Re MF Global UK Ltd and Re Omni Trustees Ltd give conflicting views as to whether section 236 of the Insolvency Act 1986 has extra-territorial effect. In this article, we look at the reasoning in the two judgments and discuss a possible further argument for extra-territorial effect. The conflicting rulings on section 236 In both Re MF Global UK Ltd [2015] EWHC 2319 (Ch) and Re Omni Trustees Ltd [2015] EWHC 2697 (Ch) the office holders sought orders for the production of witness statements and supporting documentation from respondents who were resident overseas. Continue reading >>>
1 day 8 hours ago
Millennials are starting to focus on saving money for their futures, according to a recent financial survey. Fidelity Investments, the world’s second-largest mutual fund and financial services group, conducted a survey of 4,650 households with a minimum of $20K in annual income and learned that millennials between the ages of 25 and 34 are saving more money than ever in anticipation of retirement. This is surprising news given that younger people in the U.S. have historically had difficulty when it comes to planning ahead for their eventual retirement because they have only recently entered the workforce and can’t imagine retiring. Although older workers still save higher percentages of their income – workers between the ages of 35 and 50 save 8.2 percent of annual pay, while workers between the ages of 51 and 69 save 9.7 percent of their pay – younger employees are doing so at a faster rate. In fact, millennials are saving for retirement at a faster rate than any other age group. The median savings figure for millennials is 7.5 percent, which includes money saved from their paychecks and any matching amounts they receive from their employers. That represents a massive jump from a figure of 5.8 percent just two years ago.
1 day 9 hours ago
The First Circuit, in the latest installment of In re Redondo Construction Corporation, ruled that when it comes to overlapping pre- and postjudgment interest, you can’t have your cake and eat it too: under any federal case, including diversity and bankruptcy cases, where a plaintiff is entitled for the same period to both prejudgment interest under state law and postjudgment interest under federal law, plaintiff may only recover postjudgment interest during the overlap. P.R. Highway & Transp. Auth. v. Redondo Constr. Corp. (In re Redondo Constr. Corp.), No. 15-1397, __ F.3d __ (1st Cir. Feb. 10, 2016) (available here). In the 1990s, Redondo Construction Corporation contracted with the Puerto Rico Highway and Transportation Authority to work on three construction projects. Redondo later sued the Authority seeking payment for additional work under the contracts. However, Redondo filed for bankruptcy under chapter 11 before the claims were resolved. Post-petition, Redondo filed its complaints through the bankruptcy court and sought prejudgment and postjudgment interest in connection with its claims under federal and Puerto Rico statutes.

Read More from: Basis Points

1 day 10 hours ago
Maryland attorney, Jeffrey Scholnick recently wrote an article in Spanish about the importance of knowing consumers’ rights when purchasing a car, which was published in the February 2016 edition of Mundo Latino. In Mr. Scholnick’s article, “Conozca Los Derechos Del Consumidor,” he further explains advice provided by the Federal Trade Commission about how to avoid getting into financial trouble when purchasing a car. Read the article in its entirety here. Mr. Scholnick’s article is printed on page 33 within the publication, but the online page-flip feature will list p.41/48. About Jeffrey Scholnick: Jeffrey Scholnick has been practicing law since 1983, and he has dedicated his legal career to being an exemplary attorney, known for his professionalism, competence and courtesy. He is one of the few Spanish-speaking attorneys in the Baltimore, Md. area and provides legal services for a wide range of practice areas. For more information about the legal services offered at the Law Offices of Jeffrey Scholnick, contact Jeffrey Scholnick at JScholnick@Scholnicklaw.com or (410) 494-9944 today.

Read More from: Scholnick Law

1 day 10 hours ago
Following the Presidents Day holiday weekend, Caesars Entertainment Operating Co. will hope to be one step closer to a restructuring deal. On Wednesday, the casino and hotel company will go before a Chicago bankruptcy judge to ask for permission to bring in a mediator to help broker a deal with its warring creditors. The company, or CEOC, earlier this month filed a motion in the U.S. Bankruptcy Court in Chicago requesting a mediator, hoping the act of asking for one alone would “incentivize the parties to reach a global compromise based on the current ongoing negotiations before a formal mediation session even occurs.” While CEOC has secured the support of senior lenders and bondholders for a plan to reduce its $18 billion debt load by $10 billion, it hasn’t been able to reach a deal with junior creditors. The request for a mediator comes more than a year into Caesars’ chapter 11 case.

Read More from: WSJ.com: Bankruptcy Beat

1 day 10 hours ago
This is something that I explore with every potential client on their initial free consultation visit to my office. Everyone’s situation is different and there are many reasons why I might recommend a potential client file one chapter over another. For instance, if someone is trying to protect equity in an asset such as a home, car or cash, I may advise a chapter 13 bankruptcy. If a potential client is trying to save their home from foreclosure or their car from repossession I may also recommend chapter 13. On the other hand, there are various reasons why I may recommend a chapter 7 bankruptcy. Some reasons where I might recommend a chapter 7 include a scenario where someone has no assets and all of the problem debts are unsecured with no liens. Another situation may be a potential client who does not have enough income to fund a chapter 13 payment plan but needs immediate relief from debt and creditors.

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

1 day 11 hours ago
Arizona power-plant operator Sundevil Holdings Inc. filed for chapter 11 Tuesday after defaulting on more than $237 million in debt. Read the Daily Bankruptcy Review article here. (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 http://on.wsj.com/DJBankruptcyNews, scroll to the bottom and click “try for free.”) Oil is sliding toward $25 a barrel, which means more cuts are lurking for already-struggling companies in the oil patch, The Wall Street Journal reports. Bankruptcy Beat catches up on the legal bar brawl between the Revel casino in Atlantic City, N.J., and its shuttered restaurants.

Read More from: WSJ.com: Bankruptcy Beat

1 day 14 hours ago
Further to Mark's post on the settlement negotiations, we now have an order from Judge Griesa that brings more love from New York to Argentina than it has seen in a decade, maybe ever. The order, granted near-instantly on the Republic's request, tells the remaining holdouts (call them hyper-holdouts for short), to show the court by February 18 why it should not lift the pari passu injunctions. It turns the question, "Why should the court help Argentina?" into "Why not?" Why not, indeed? Mark rightly points out that it takes more than a whim and a ray of sunshine to dissolve or fundamentally change a permanent injunction. But fundamental change is in the eye of the beholder, especially when a government is involved, especially when a big election intervenes.

Read More from: Credit Slips

1 day 23 hours ago
Once again, Orrick has been ranked a Top Ten Bankruptcy Law Firm by The Deal Pipeline. These rankings are released on a quarterly basis, compiling comprehensive deal intelligence to identify the leading law, crisis management, investment, and non-investment firms and professionals involved in bankruptcy transactions throughout the United States. After cracking the top ten in Q1, Orrick remained among the top ten bankruptcy law firms in every quarter in 2015. Orrick’s restructuring team enjoyed a busy year, including such recent highlights as representing the City of Stockton in its exit from bankruptcy and dismissal of an appeal filed by holdout creditor Franklin Templeton in the US Bankruptcy Appellate Panel of the Ninth Circuit; Tirreno Power on a complex corporate reorganization including the negotiation and drafting of a €1 billion debt restructuring agreement, which was awarded Restructuring Deal of the Year at the 2016 Legalcommunity Energy Awards; and IFM Investors Pty Ltd, on behalf of IFM Global Infrastructure Fund, in its $5.72 billion acquisition of 100% of the membership interests of ITR Concession Company, which operates and maintains the Indiana Toll Road – named M&A Deal of the Year by ​M&A Advisor. To see the complete list of rankings, please click here.
2 days 5 hours ago
In re Barrett, ND California 2016, lawyer debtor The United States Bankruptcy Court for the Northern District of California issued an interesting ruling that discharged over a quarter millions dollars of federal student loan debt for a 56-year-old securities law attorney (In re Barrett, Case No 14-43516). Kevin Barrett is a single man who has been a licensed attorney since 1987.  He is in good health and has no dependents.  At one point he earned as much as $165,000 per year as a securities lawyer, but that income ended in 2007.  He earned very little for the next 4 years.  In 2011 he was hired for $98,000 per year by another firm until August of 2013 when he was terminated.  Since that time he has struggled to earn more than $10,000 per year in his own practice. The debtor did not live extravagantly. He paid $750 per month for rent and drove an older car. He had no savings or retirement account. The debtor had paid nearly $40,000 in student loan payments over the years.
2 days 6 hours ago
Authored by Heather S. NasonThe Federal District Court for the Middle District of Florida ruled last month that a lender does not need to show cause as a condition to enforcing an assignment of rents. In PNC Bank v. Maranatha Properties, Inc., No. 5:15-cv-563-Oc-30PRL, 2016 WL 319255 (M.D. Fla. Jan. 26, 2016), PNC initiated a foreclosure of a mortgage on properties in Marion and Lake Counties, Florida that secured a $1,800,000 loan to Maranatha. In connection with the loan and mortgage on the properties, Maranatha also executed an Assignment of Rents and Leases providing for an unconditional assignment of leases, rents and profits derived from the properties in the event of a default. After Maranatha defaulted on the loan, PNC sought to enforce the Assignment of Rents under Florida Statute § 697.07. Maranatha argued that PNC could not enforce the assignment of rents because the value of the mortgaged properties was sufficient to satisfy the mortgage debt. In support of its argument, Maranatha relied on an opinion from the 4th DCA in which the court held that in determining whether to appoint a receiver where rents and profits have been pledged, a court may first consider whether the value of the mortgaged property alone would be sufficient to satisfy the mortgage debt.

Read More from: Florida Banking Law Blog

2 days 8 hours ago
In a decision with significant implications for investors and underwriters alike, the Court of Appeals for the Second Circuit has held that contribution claims arising from the purchase and sale of a security of an affiliate of the debtor can and should be subordinated under section 510(b) of the Bankruptcy Code.  The decision, ANZ Securities, Inc. v. Giddens (In re Lehman Bros. Inc.), stemmed from the liquidation of Lehman Brothers, Inc. (LBI) pursuant to the Securities Investor Protection Act and is one of many precedential bankruptcy decisions arising from the Lehman cases.  Background LBI was the lead underwriter for certain notes issues by one of its affiliates, a debtor in a separate chapter 11 case.  The appellants asserted that, as co-underwriters for the notes, they allegedly incurred defense and other costs as a result of lawsuits commenced against them by investors in the notes.  After the appellants filed claims against LBI for reimbursement or contribution of these costs, LBI sought to subordinate those claims pursuant to section 510(b) of the Bankruptcy Code.
2 days 9 hours ago
Chris Ware/Bloomberg News
Hundreds of dollars in car-service charges, meals costing $50 a head and overly expensive copying charges are among the expenses that a government watchdog is targeting in supermarket operator A&P’s bankruptcy case. U.S. Trustee William K. Harrington recently filed court papers raising questions about thousands of dollars in expenses that several law and consulting firms incurred for their work on A&P’s liquidation. In bankruptcy, legal and other professional bills are subject to public scrutiny and court approval. Bankruptcy watchdogs like Mr. Harrington, who is part of the Justice Department, also keep an eye on the bills in what is typically an expensive process.

Read More from: WSJ.com: Bankruptcy Beat

2 days 9 hours ago
This March 28, 2012, photo shows gambling chips on a card table at the former Revel casino in Atlantic City, N.J.
Associated Press
Glenn Straub is “at it again,” according to lawyers for a handful of deserted restaurants trapped inside the shuttered Revel Casino Hotel in Atlantic City, N.J. Bankruptcy-court papers filed earlier this month show yet another dispute between the restaurants and the Florida-based developer has flared up, this time fueled by nearly a quarter million dollars of alcohol—beer, wine and liquor left behind in the darkened resort. Last spring, a bankruptcy judge approved an $82 million sale of Revel to Mr. Straub, ending nearly 10 months of courtroom combat for control of the property. The purchase price amounted to more than a 96% discount from the $2.4 billion it cost to build Revel. Revel never turned a profit after opening its doors in 2012 and landed in chapter 11 twice in just two years.

Read More from: WSJ.com: Bankruptcy Beat

2 days 9 hours ago
Sundevil Power Holdings, LLC and SPH Holdco LLC have each filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code before the United States Bankruptcy Court for the District of Delaware (lead case no. 16-10369).  The debtors are merchant power generators and own two 550 megawatt natural gas-fired power blocks of the Gila River Power Station, located in Gila Bend, Arizona.  The cases have been assigned to the Honorable Kevin J. Carey.  The debtors will seek authority to obtain $45 million in debtor-in-possession financing and to sell substantially all of their assets.  The petition (including the consolidated list of top 20 creditors), the first day declaration and the docket are available through Garden City Group. Contact Norman L. Pernick, Nicholas J. Brannick, or David W. Giattino for more information.
2 days 10 hours ago
Invest Wisely I have to share with you a cautionary tale of a prior client who had an investment in a real estate property on the South side of Chicago. The neighborhood in which he invested was not great.  In fact, it’s one of the two or three neighborhoods in Chicago that has not seen+ Read More The post When Bankruptcy Is Not Enough: Be Careful When Investing In Suspect Real Estate appeared first on David M. Siegel.
2 days 11 hours ago
I get asked by clients all the time why they are now being sued for a debt they guaranteed or co-signed with another individual, usually a relative or close friend.  They will say “I am just the co-signor.  It is their debt.”, or “They are the primary, I am just the secondary.” Creditor’s Right to Sue You Unfortunately, whenever you sign your name on loan papers whether it is for your debt or someone else’s, you are creating a binding legal relationship.  The lender, also called the creditor be it a bank, credit union or credit card issuer has obtained in the fine print the right to sue you on your guaranty for the debt involved.  In other words you and the person you are signing with are both equally 100% liable for the debt. Hopefully, the person with whom you have co-signed, with will make every payment as they become due and you will never be confronted with this issue.  But, if they ever default on payments, the creditor has the right to come after you and they almost always do so.  The creditor does not even have to sue the primary with you on the lawsuit especially if they know you have the means to pay the debt and the primary does not. In reality, that is the main reason you were asked to sign in the first place, because the creditor knew you could pay if the primary did not.

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

2 days 11 hours ago
northwestbankruptcyattorneys.com Tax refund season is typically the busiest time of year for bankruptcies to be filed.  The reason is pretty simple, people who have been slogging along trying to pay their bills have not had the extra money to use for a bankruptcy attorney.  Their tax refunds change that and finally make it possible for many people to get their cases filed. If you are considering bankruptcy there are some things to keep in mind if you are expecting a big tax refund. Filing a case before you receive the refund can lead to some or all of the refund having to be turned over to your bankruptcy trustee.  This all depends on your state’s exemptions. Some states, Ohio for example, will allow you to exempt all of your additional child tax credit and earned income credit.  Some states, Washington and New York for example,  allow you to use either state or… View original post 188 more words
2 days 12 hours ago

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