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Authored by J. Ellsworth Summers, Jr. and Michael S. Waskiewiczand J. Ellsworth Summers, Jr. and Michael S. Waskiewicz of Rogers TowersThe Supreme Court has unanimously decided that debtors are prohibited from stripping off junior mortgage liens in Chapter 7 bankruptcy cases. Lien stripping is where a bankruptcy court relieves a debtor of his second mortgage because the value of the property is less than the balance of the first mortgage. The Court’s decision in Bank of America, N.A. v. Caulkett is a boost for creditors as it now prohibits this practice across the board. The facts in Caulkett were straightforward; each debtor owned a home encumbered by a senior mortgage as well as a junior mortgage. However, the junior lien was wholly underwater—that is the value of the home was less than the outstanding first mortgage, thus rendering the junior mortgage completely valueless. In finding that the junior mortgages were completely valid under state law, the Court held that debtors cannot strip off junior mortgages regardless of whether they are partially or wholly underwater.

Read More from: Florida Banking Law Blog

12 hours 20 min ago
Construction of the Baha Mar resort on the beach on New Providence island, Bahamas, July 2014. BAHAMAR Published Credit: Baha Mar Published Credit: Baha Mar
Baha Mar
Baha Mar Ltd., the development company behind the massive $3.5 billion resort complex in the Bahamas, filed for bankruptcy protection Monday, blaming a Chinese contractor for repeated construction delays that left it owing millions of dollars a month to employees with no customers to serve. The Wall Street Journal has 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.”) A judge on Monday approved a settlement in the long-running legal fight between Lehman Brothers Inc. and Barclays PLC, DBR reports in WSJ.

Read More from: WSJ.com: Bankruptcy Beat

13 hours 6 min ago
Susanne Soederberg, a professor of political studies and global development studies at Queen’s University in Canada, is calling for the student loan industry to be, “revealed, attacked, and uprooted.” In her article on Dollars & Sense, Soederberg says the educational finance is not part of the natural order of things. Rather, it’s part of the poverty industry, which
includes educational lending, but extends to other forms of consumer credit—such as payday loans, credit cards, sub-prime housing loans—all of which feed off of and reproduce marginalization and insecurity. The increasing reliance on expensive personal loans to replace or augment wages—as well as obtain an education—is not a natural phenomenon. Rather, it is a social construction that needs be revealed, attacked, and uprooted, not negotiated within the territory of consumer protection, which is sponsored by the debtfare state and the capitalist interests it represents.
The debtfare state, a term apparently coined by Soederberg, is what she calls a new feature of governance that exists alongside the welfare state. The system uses a set of institutional and ideological practices aimed at
1 day 3 hours ago
“Butler-style” representation, under which the sequaciously servile lawyer does whatever the client wants and then cites that client’s command as a shield to the improper actions has no place in bankruptcy court or in any court.” The above quote is taken from a recent bankruptcy court case in Nevada, In Re Blue Pine Group, Inc., and it points out the responsibility that a bankruptcy attorney has not only to his or her client, but to the court. In rare cases, if the attorney and client can not agree on a course of action, and the attorney knows that course of action to be ethically improper or legally wrong, then it may be necessary for the attorney to withdraw from representation of the client.  Most judges understand that these situations do occur, and when explained properly, will allow the attorney to withdraw. If you are the client of a bankruptcy lawyer, follow their advice … they are there to help guide you through the process and quickly and smoothly as possible.
1 day 4 hours ago
This is the fifth post in our Bitcoin Bankruptcy series on the Weil Bankruptcy Blog.  We have concluded that a hypothetical U.S.-based bitcoin exchange likely would not constitute a stockbroker or a commodity broker under the Bankruptcy Code.  Therefore, unless the bitcoin exchange is a certain type of bank, it is probably eligible for chapter 11 relief.  This entry explores the question of whether a bitcoin exchange might be considered a bank. 
1 day 7 hours ago
JEFF KOWALSKY/BLOOMBERG NEWS
Chicago class-action lawyer Clinton Krislov is better known for defending Illinois workers’s pension plans than for standing up for consumer rights in bankruptcy cases. But for three and a half years, Mr. Krislov has been fighting on behalf of three jilted gift-card holders to recover money from the bankruptcy estate of shuttered book chain Borders. As The Wall Street Journal explored today, Mr. Krislov is asking the U.S. Supreme Court to take up a case that will determine if Borders’s gift-card holders waited too long to try to turn their credits into cash. Several lower courts have ruled against the customers, including the Second U.S. Circuit Court of Appeals. The bankruptcy battle spotlights an issue most consumers don’t think about until it is too late: Retailers in bankruptcy can stop accepting gift cards at any time and don’t always have to pay out unredeemed cards.

Read More from: WSJ.com: Bankruptcy Beat

1 day 8 hours ago
Culture is measured in the good banks do for communities and customers, employees and shareholders. That kind of culture must be built over generations.

Read More from: BankThink

1 day 8 hours ago
Per a Court notice to the bar dated June 10, 2015:Effective Monday, June 15, 2015, attorneys admitted to the bar of this court, who are registered ECF Filing Users may reset their password via a link on the SDNY ECF login page at ecf.nysd.uscourts.gov. A new password will be sent by email to the address registered to the user’s ECF account. For more, see: http://www.nysd.uscourts.gov/cases/show.php?db=notice_bar&id=381

Read More from: The COMI

1 day 9 hours ago
An interesting story in the Wall Street Journal about attempts to get value out of the gift cards of Borders, the book chain that went bankrupt a few years ago:  By Sara Randazzo June 28, 2015 7:14 p.m. ET  A Chicago plaintiff’s lawyer is out to redeem some of the country’s longest languishing gift cards. In a petition filed this month with the U.S. Supreme Court, attorney Clinton Krislov is making a last-ditch effort to recover some value for holders of gift cards sold by Borders Group, the book chain that went under four years ago. The petition is the last chapter in a long-running fight over whether the gift-card holders waited too long to try to turn their credits into cash. The rights of gift-card holders are being questioned in retail bankruptcies across the country, including through a recent lawsuit filed by the Texas attorney general’s office in RadioShack Corp.’s chapter 11 case. Borders may be long dead, but there is potentially big money on the line: The defunct retailer estimates customers never redeemed 17.7 million gift cards worth $210.5 million by the time it shut its doors in September 2011.The Borders bankruptcy estate still has nearly $8 million left for professional fees and creditors. Mr.

Read More from: The COMI

1 day 10 hours ago
An Oregon foreclosure mediation program has undeniably helped many debtors find a way to stay in their homes. The program provides Oregonians with a chance to meet with lenders in order to find ways avoid a foreclosure. The latest data from the Oregon Department of Justice show that since the program’s inception, more than 1,700 Oregonians have used it to reach agreements with their banks. The bad news is that because mortgage lenders are obligated to participate in mediation but not required actually reach a resolution with the borrower, over 1800 of the conferences have done nothing to ward off foreclosure. Even more borrower have chosen to not participate in the program at all. Most of them probably realized that the program was unlikely to work. The reality is that Chapter 13 Bankruptcy is the one tool that will almost always enable an Oregon homeowner to stop the foreclosure process in its tracks. Once the Chapter 13 is filed, the homeowner is given the chance to pay off the mortgage arrears over a three to five year period interest free. Contract our offices if you have any questions at all about how Chapter 13 Bankruptcy might enable you to keep your house. The original post is titled Foreclosure Mediation Program for Oregon Debtors , and it came from Portland Bankruptcy Attorney | Northwest Debt Relief .

Read More from: Oregon Bankruptcy Lawyer

1 day 10 hours ago
You'll find many disruptors in banking, but startups like Moven aren't among them. In essence, virtual banks simply dress up web storefronts to look like banks but offer one-tenth the services.

Read More from: BankThink

1 day 10 hours ago
Per www.globalinsolvency.com: Mon., June 29, 2015  Bank creditors to Drydocks World (DDW), Dubai’s maritime engineering business, are expecting to receive proposals from the government-owned company to restructure some of the US$2.3 billion debt it refinanced in 2012, The National reported. Recent talks with creditors have left them convinced that the company, owned by the Dubai World conglomerate, will seek to change the terms of its agreement to repay some $800 million of bank loans in the summer of 2017. “We’re fully expecting a second round of restructuring, but there have been no formal proposals yet,” said one banking executive, speaking on condition of anonymity. A spokesman for DDW declined to comment on the possibility of a new round of restructuring. A source close to the company, who asked not to be named, said that a new deal on the $800m of debt would be a sensible option for the company to consider, given the global environment of lower interest rates than when the previous deal was hammered out, and the emirate’s improved economic prospects.

Read More from: The COMI

1 day 11 hours ago
It comes as no surprise that Chair White addressed proxy matters in her keynote remarks at the Society of Corporate Secretaries and Governance Professionals' National Conference, which was attended by more than 750 in Chicago.
1 day 11 hours ago
California appeals court  slaps down servicer’s attempt to require payment the entire mortgage loan a condition of homeowner protection. Nice try, Ocwen. But no, says an intermediate California appeals court. Such an interpretation would gut the California Homeowner’s Bill of Rights. Facing foreclosure The facts in Valbuena v. Ocwen  are common:  Ocwen became the servicer of the Valbuena’s mortgage loan when the loan was in default. Ocwen filed a notice of foreclosure sale and sent the homeowners a letter offering to consider a loan modification.  The homeowners submitted an application and supplemented it when Ocwen told them it was missing necessary documents. Two days later, Ocwen foreclosed. Dual tracking prohibited California’s homeowners bill of rights forbids a foreclosure sale while the mortgage servicer is considering an application to modify the loan in default. Nonetheless, Ocwen solicited a loan modification application and barreled right along to foreclosure.
1 day 11 hours ago
Receiving Wide Coverage ... Greece Bank Shutdown: Greece has closed its banks for the next six days and imposed capital controls in an effort to avert financial panic as the country edges closer to a potential exit from the eurozone. Over the weekend, steady streams of depositors had already emptied many ATMs in Athens, according to the Wall Street Journal. The rapidly escalating Greek debt crisis rattled global markets Monday, with the S&P 500 on track...

Read More from: BankThink

1 day 11 hours ago
 (courtesy of Dave’s iPhone on June 18, 2015) Two Thursdays ago, we visited my wife’s family in Potomac, Maryland. In addition to seeing the usual sites, we did a Supreme Court “drive-by” and snapped the above photo, a very timely now outdated, but still very political picture. Indeed, Friday morning, the Supreme Court issued its 5-4 decision in Obergefell v. Hodges ruling that same sex-marriage is a Constitutional right. The day before, it issued its 6-3 decision in King v. Burwell upholding tax subsidies under the Affordable Care Act (a/k/a “Obamacare”). And, as a I type, folks are waiting impatiently for the Supreme Court (i.e., “Waiting for Lyle“) to issue at 10 a.m. the remaining decisions from this term on congressional redistricting, power plant emissions, and execution methods. Meanwhile, the ink is now two weeks old on the Court’s Baker Botts, L.L.P. v. ASARCO, LLC decision, a much less-awaited decision that likely didn’t attract protestors to the Courthouse steps.

Read More from: Plan Proponent

1 day 12 hours ago
The Molycorp Mountain Pass open pit mine in Mountain Pass, California, U.S., on Dec. 13, 2010.
Jacob Kepler/Bloomberg News
A protest from senior lender Oaktree Capital pushed Molycorp Inc. back into talks over its bankruptcy financing package. The Wall Street Journal has 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.”) Molycorp’s bankruptcy is set to leave Oaktree unharmed, WSJ reports. Energy Future Holdings Corp. called off the bankruptcy auction of its stake in Oncor, DBR reports in WSJ.

Read More from: WSJ.com: Bankruptcy Beat

1 day 13 hours ago
Per www.forbes.com:Alan Zimmerman  6/23/2015 @ 9:01AMPatriot Coal has amended the bidding procedures for the sale of its assets to, among other things, extend the timeline for the bidding process, reduce the bid protections for stalking-horse bidder Blackhawk Mining, and ease the overbid requirements of the bidding process.

Read More from: The COMI

2 days 2 hours ago
Per www.wsj.com: By Katy Stech June 24, 2015 4:19 p.m. ET   The company behind the Local.com website—a place for Internet users to search for local businesses—filed for bankruptcy on Tuesday, saying it stumbled after a sudden drop in traffic last year. Company officials who put Local.com Corp. into chapter 11 protection plan to sell the 48-worker company, which has patents for the way it generates search results for consumers who are looking for businesses, products and services by geographic area.For more, see: http://www.wsj.com/articles/local-com-files-for-bankruptcy-1435177004

Read More from: The COMI

2 days 4 hours ago
Probably the worst way for any Portland area Chapter 13 Bankruptcy Debtor to make a monthly payment is out of pocket.  If you have a regular job this isn’t a problem, the payment is just deducted from you wages and you never falls behind. Up to now self-employed debtors haven’t had any options other than to obtain checks and mail them once a month. The success rate in Chapter 13 Bankruptcy for debtors taking this route has been abysmal but up to now there hasn’t been any other options. I am please to report that soon Portland area Chapter 13 Bankruptcy debtors will soon be able to have their payments processed through ePay. This option is way easier and more convenient than the check route and a million times less stressful. A company called TFS will be processing the payments. Chapter 13 Bankruptcy Debtors in the Western District of Washington have been using this provider for over a year without incident. One advantage of the electronic payments is that if you are facing a Motion to Dismiss for unpaid Plan Payments, it will become much easier to meet the deadline and submit proof of payment to the Chapter 13 Trustee. The old way of mailing a check to Memphis, TN and waiting an additional week of so for it to reach the coffers of the Portland Chapter 13 Bankruptcy Trustee will soon be a thing of the past.

Read More from: Oregon Bankruptcy Lawyer

3 days 5 hours ago

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