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David Siegel:   Of course, the creditors have an opportunity to show up at this meeting, and witness it, ask a few questions, possibly tell the trustee about something that they may know about the debtor.  For example, if there’s property in Wisconsin that was not disclosed or an old Corvette that miraculously didn’t make the schedules. + Read More The post What’s Is The Meeting Of Creditors Under Section 341 Of The Bankruptcy Code? appeared first on David M. Siegel.
2 weeks 26 min ago
While there are thousands upon thousands of questions pertaining to bankruptcy that I field every year, it seems that I hear three specific questions most often. I want to take the time to share the answer to those questions today. The three questions are: 1) How much is it to file? 2) Will I be+ Read More The post Top Three Most Often Heard Bankruptcy Questions appeared first on David M. Siegel.
2 weeks 41 min ago
We are seeing more and more older folks in the office that are struggling with paying their bills and making ends meet, especially those on a fixed income. As expenses increase, monthly retirement payments, including social security, do not increase. That is a recipe for disaster. There is no upper age limit on filing for bankruptcy. Although as more older folks visit us for help with bankruptcy, some do have retirement savings they want to protect. The good news is that if you file bankruptcy, you will, almost always, not lose your retirement savings. The only possible exception is if you had put a very large amount of funds into the retirement or 401k just before filing bankruptcy. The federal exemption laws, and most state exemption laws, do protect your retirement savings from going to pay your creditors. A few years ago, the United States Supreme Court ruled that the retirement exemption is very broad and applies to most all types of retirement, including ESOP’S, or employee stock ownership plans. This was great news for consumers. When you meet with an attorney, be sure to disclose all types of retirement plans that you currently have, as the law is constantly changing.
2 weeks 2 hours ago
Pope Francis delivers a sermon during a mass at the shrine of the Virgen de la Caridad del Cobre in Santiago, Cuba, Sept. 22. As Catholic officials highlight the pope’s inaugural U.S. visit, the Catholic church in the U.S. is seeking a different kind of renewal—in the courtroom.
Orlando Barria/European Pressphoto Agency
As Catholic officials highlight Pope Francis’s inaugural U.S. visit as a time of spiritual renewal, the church here is seeking a different kind of renewal—in the courtroom. Four dioceses are in active bankruptcy proceedings attempting to settle claims of sexual abuse by their clergy: Milwaukee, Wis.; Gallup, N.M.; Stockton, Calif.; and Minnesota’s Twin Cities. Filing for bankruptcy temporarily freezes all litigation, giving a diocese breathing room to continue serving its flock while it negotiates a plan to compensate, and potentially reconcile with, abuse victims. (Pope Francis is expected to meet with victims during his visit, though it isn’t on his official itinerary.)

Read More from: Bankruptcy Beat

2 weeks 2 hours ago
In re ICL Holding Company, Inc., No. 14-2709, 2015 WL 5315604 (3d Cir. Sept. 14, 2015), aff’g sub nom United States v. LCI Holding Co., Inc., Nos. 13-924 (SLR), 13-1188 (SLR), 2014 WL 975145 (D. Del. March 10, 2014)

Read More from: Delaware Bankruptcy Insider

2 weeks 4 hours ago
A few months ago, on July 20, 2015, the Great Atlantic & Pacific Tea Company, more commonly known as “A&P,” made history by filing what we in the restructuring industry like to call “Chapter 22”—that is, a Chapter 11 restructuring bankruptcy part deux. A chapter 22 in and of itself is not that unique, but the new “A&P” bankruptcy filing came less than 5 years after its previous chapter 11 filing from the end of 2010. Read more here.
2 weeks 4 hours ago
Authored by Edward L. Kelly and Karl R. Grussand Edward L. Kelly and Karl R. Gruss of Rogers TowersAn equitable lien may provide a Florida creditor relief in scenarios where Florida’s broad homestead protections would otherwise bar the forced sale of homestead property. But a string of cases following the 1993 decision of the Florida Supreme Court in the case of Palm Beach Savings & Loan Association v. Fishbein presents a misleading picture of what a creditor must prove to overcome the homestead protections and obtain an equitable lien. Three Exceptions to Homestead Protection Article X, Section 4 of the Constitution of the State of Florida, provides only three discrete scenarios where a homestead may be subject to forced sale:
  1. To pay taxes and assessments on the homestead;
  1. To satisfy obligations contracted for the purchase, improvement or repair of the homestead; and
  1. To satisfy obligations contracted for house, field or other labor performed on the homestead.

Read More from: Florida Banking Law Blog

2 weeks 4 hours ago
Identity thieves are now posing as “helpful” folks from the IRS. These scammers email you with the disturbing news that your tax return has been flagged for further examination. Posing as representing the IRS Taxpayer Advocate Service, they offer help in “resolving” the problem, if you’ll just click a link and provide them information. They even provide a fake case number. Stop! Add this offer of “help” to the collection calls threatening arrest if you don’t pay the caller money as the latest scams referencing the IRS. These are scams.  How do I know? Tax authorities don’t use email Neither the IRS nor its Taxpayer Advocate Service use email, text messages or social media to contact taxpayers. I’ve had trouble, as a lawyer, trying to email IRS personnel about our ongoing work on a client’s tax problem.  They are so skeptical about email that the tax official and I had to develop a code to identify the case in question. Tax authorities almost always initiate contact with you through the mail.  It’s safe to say that if the IRS phones, faxes, or emails you about a tax problem, it’s a scam. Report those posing as the IRS If you receive an email purporting to be from the IRS Taxpayer Advocate Service, don’t open it. Certainly don’t click any links in the email.  Nothing good will come of it.
2 weeks 5 hours ago
On September 14, 2015, the Third Circuit released a precedential opinion (the “Opinion”) which addressed payments from a buyer to non-debtor parties in a 363 sale.  The Third Circuit’s opinion is available here.  If you prefer the version of the Opinion published by Westlaw, it is ICL Holding Company, Inc., et al. v. United States, 2015 WL 5315604 (3d Cir. Sept. 14, 2015). In this case, a creditor was purchasing all of the Debtor’s assets with a credit bid.  To insulate their bid from a Committee objection, the Purchaser agreed to pay the legal and accounting fees of the Debtor and the Committee by funding, outside of the bankruptcy estate, an escrow account.  The U.S. government objected to the payment to the Committee as was a “violation of the absolute priority rule”.  Opinion at *10.  The attorneys for the IRS objected to the sale and the payment to the Committee as its administrative (tax) claims would be unpaid. Ruling from the bench, the Bankruptcy judge held that the settlement funds (deposited into escrow) were not part of the Debtor’s estate, and therefor not a consideration in its analysis of whether the absolute priority rule was violated.  Opinion at *10-11.  The District Court agreed with the Bankruptcy Court, holding that “the funds at issue were not property of the estate and thus not subject to the Code’s distribution rules.”  Opinion at *12.
2 weeks 6 hours ago
Series: Business Law Dumbed Down 2015 Limited liability companies are commonly recommended by attorneys as a better option for a new business than a corporation or partnership and the recommendation is commonly correct. However, many attorneys treat an LLC as a corporation all but in name, and that is wrong. This webinar will explain why this is and will provide general drafting guidelines for an LLC operating agreement, which is the contract that governs the relationship among the members of the LLC. Read more here.
2 weeks 6 hours ago
Series: IP 101 2015 There are countless infomercials claiming to offer the latest and greatest patent and invention kit. One visit to the USPTO website reveals that a patent may be more complicated than an infomercial may have you believe. This webinar will cover the basics of researching, applying for and protecting a patent. Read more here.
2 weeks 6 hours ago
Series: Newbie Litigator School Lawyers often cannot win the case without help from experts. But when do they need to get involved? And who should you choose? What disclosures do you need to make to the court and opposing counsel? How do you get your expert qualified to testify at trial? We will discuss these issues and more, to help you get the most out of your experts. Read more here.
2 weeks 6 hours ago
Film studio Relativity Media LLC’s sale is facing some hurdles from affiliates of Elliott Management.Read the Daily Bankruptcy Review article via The Wall Street Journal. (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, scroll to the bottom and click “try for free.”) Energy Future Holdings Corp. won approval to send out its chapter 11 plan to creditors for a vote, DBR reports. Great Atlantic & Pacific Tea Co. won a bankruptcy judge’s approval to sell 95 of its stores, DBR reports. According to WSJ, the former owner of Peanut Corp. of America, which has taken a turn in bankruptcy, was sentenced to 28 years in prison for helping to cover up what led to a massive salmonella outbreak.

Read More from: Bankruptcy Beat

2 weeks 7 hours ago
The English High Court has, in one of the few successful cases on wrongful trading, clarified when directors ought to know that there is no reasonable prospect of avoiding insolvent liquidation and where the burden of proof lies in such cases. Background In Brookes v Armstrong (also known as Joint Liquidators of Robin Hood Centre Plc v Armstrong) [2015] EWHC 2289 (Ch), the English High Court considered claims by Joint Liquidators against two directors of the insolvent company under the wrongful trading provision of the Insolvency Act 1986 (section 214). Claims had also been advanced under the breach of duty provisions of section 212. The company had run a Robin Hood themed tourist attraction but entered liquidation on 6 February 2009. There were various key events in the timeline leading up to formal insolvency relating to the liquidators’ claim: (1) the year-end accounts for 2005 and 2006 showed trading losses, (2) receipt of professional advice in October 2006 in relation to a significant VAT liability, (3) the year-end accounts for January 2007 showing a loss not including the VAT liability or an expected increase in the rent, and (4) a letter from HMRC in May 2007 confirming the VAT liability following review. Key points The Court had to consider (amongst other things):

Read More from: eSQUIRE Global Crossings

2 weeks 9 hours ago
Summary In a 6 page decision denying a motion to dismiss, released September 21, 2015, Judge Gross of the Delaware Bankruptcy Court considered the legal argument of whether a bankruptcy trustee could legally pursue a recovery against a company’s directors for allowing a WARN claim to arise.  Judge Gross’ opinion is available here (the “Opinion”). Because this was a decision on a motion to dismiss, the legal analysis is not as fulsome as is normal for an opinion of the Delaware Bankruptcy Court.  Should the parties fail to settle this issue and an opinion be issued after a trial, I will be sure to provide an update.  For now, it is enough to know that this type of case CAN survive a motion to dismiss. Judge Gross’ Opinion In response to the Trustee’s complaint that the directors breached their fiduciary duty, the defendants in this case made two arguments: (1) This was a ‘deepening insolvency” claim, which is unrecognized under Delaware law, and (2) the Trustee is the improper party to bring this claim (i.e., he lacks standing).  Opinion at *3.
2 weeks 18 hours ago
The first, and by far, most common type of bankruptcy is liquidation under Chapter 7 of the Bankruptcy Code, also referred to as a straight bankruptcy. In this type of bankruptcy all of the debtor's (or, the person filing the bankruptcy) assets which are nonexempt are sold and the proceeds of the sales are distributed amongst creditors (everyone who is owed money by the debtor.) After doing so, the remaining debt is wiped out giving the debtor what is known as a "fresh start." The second commonly used type of bankruptcy is known as a reorganization under Chapter 11 or 13 of the Bankruptcy Code. Chapter 11 is most commonly used by companies and Chapter 13 is most commonly used by individuals. In this reorganization, the debtor still pays some or all of his or her debt under a 3-5 year agreed-upon plan. In a Chapter 11 bankruptcy, creditors have the right to vote on or approve of the companies proposed reorganization. Under Chapter 13 bankruptcy, the companies or individuals you owe money to don’t vote on or approve your proposed plan for paying back some of what you owe. And unlike Chapter 11, only you propose the plan for some or all of your debts. In Chapter 11, your creditors can also propose plans.
2 weeks 22 hours ago
If you’re thinking that the inflammatory words of a certain candidate in the current race to the White House may be helping to re-legitimize the condescending treatment of women through such sexist talk as referring to their monthly cycles—or imminent lack thereof—don’t expect the world of federal court judges to follow along. Read more here.
2 weeks 1 day ago
By the authority of the Heavenly Court, and by the authority of the earthly court, we hold it permissible to pray with those who have transgressed… — Kol Nidrei (Preamble) Kim Davis is the Rowan County clerk who famously made headlines for her tiff with Survivor, the arena rock band behind the Rocky III hit “Eye of the Tiger.”  Perhaps less importantly, anyone with a television, a newspaper, or internet access is aware of her faith-based refusal to issue marriage licenses to gay couples, notwithstanding her legal obligation to do so.  As we approach Yom Kippur, the Day of Atonement, we examine a recent bankruptcy court decision highlighting the tension between religious proceedings and the uniform laws of bankruptcy in the United States, and the steps that bankruptcy courts can take when religious actors or tribunals attempt to circumvent applicable U.S. law. 
2 weeks 1 day ago
In short, the answer to this question is yes. However, it is necessary to have a basic understanding of consumer bankruptcy and credit reporting in order to understand how consumer bankruptcy is erased from your record, and what to do if the record is not erased properly. In this article, we’ll discuss how long a Chapter 7 or Chapter 13 bankruptcy stays on your record, and what to do if you wish to dispute an error on your credit report. How Chapter 7 and Chapter 13 Work First of all, what is consumer bankruptcy? Put simply, consumer bankruptcy refers to a case which is filed in order to reduce or eliminate debts that are primarily consumer-related. Consumer debts are considered personal debts (e.g. medical bills), rather than business debts. The vast majority of consumer cases are categorized as either Chapter 7 or Chapter 13, with the better-known Chapter 11 category being reserved primarily for business entities.

Read More from: Young, Klein & Associates

2 weeks 1 day ago
Receiving Wide Coverage ... B of A Board Reckoning: A special meeting of Bank of America shareholders Tuesday will determine whether chief executive Brian Moynihan is permitted to hang on to the additional title of chairman. The bank's board made a unilateral decision to put Moynihan in the dual role last fall, disregarding a binding 2009 shareholder vote to keep the positions separate. Disgruntled investors saw the move as "a classic case of a too-big-to-fail bank...

Read More from: BankThink

2 weeks 1 day ago