Help Center

ABI Blog Exchange

[wsj-responsive-image P="http://si.wsj.net/public/resources/images/BN-NE663_KALOBI_P_201603211732..." J="http://si.wsj.net/public/resources/images/BN-NE663_KALOBI_J_201603211732..." M="http://si.wsj.net/public/resources/images/BN-NE663_KALOBI_M_201603211732..." caption="Martin Shkreli, the former CEO of KaloBios who was ousted last year following his arrest on unrelated securities-fraud charges" credit=John Taggart/European Pressphoto Agency" placement="Inline" suppressEnlarge="false" ] Drug maker KaloBios Pharmaceuticals is touting a new policy that calls for charging cost plus “reasonable and transparent profit margin.” The Wall Street Journal has the Daily Bankruptcy Review article here. The company’s new chief executive, who took over after Martin Shkreli was ousted last year, wants to “set the record straight” about a no-gouging policy.

Read More from: WSJ.com: Bankruptcy Beat

2 weeks 4 days ago
Coast-to-coast travel costs and troubles are serious impediments to mediations that must occur on the East Coast By Donald L. Swanson The proposal for mega-case avoidance actions is to hold mediation sessions in regional hub cities near where multiple defendants reside (instead of Wilmington or New York City) and include trained mediators from those regions on the panel of mediators. A West Coast example of how the proposal could help is In re WL Homes LLC, Case No. 09-10571 in Delaware.  WL Homes involves a builder of luxury home developments in Southern California that files bankruptcy in 2009 amid the housing market collapse.  Most creditors in WL Homes are from California—and few are from anywhere near Delaware. The Chapter 7 Trustee files 388 adversary proceedings to recover preference claims.  Most defendants in these proceedings are from California. In each of the WL Homes adversaries, the defendant is notified of a mediation process. However, a mediation session occurs in only 6 of the 388 adversaries.  For these 6, the amounts at issue are between $92,000 and $500,000 The distance between Los Angeles and Wilmington, Delaware, is 2,700 miles.  Travel costs and troubles are commensurately high.  Accordingly, establishing a Regional Mediation Hub in California would be helpful in the  WL Homes case.

Read More from: Mediatbankry

2 weeks 4 days ago
The minefield of surrenders and assignments A lease can often be the most financially draining contract a company has hanging around its neck, which can be particularly burdensome when the tenant company is already facing financial distress. Administrators are regularly faced with the task of relieving the administration estate of an onerous, costly lease and often look either to surrender the lease, which requires the co-operation of the landlord, or assign the lease to a new, incoming tenant. An assignment could require the landlord’s consent and can often be riddled with a number of conditions.  The law on surrenders and assignments of leases has recently been clarified by the cases Padwick Properties Limited v Punj Lloyd Ltd and EMI Group Limited v O & H Q1 Limited, respectively. These cases will be of interest to landlords, tenant companies and restructuring professionals alike, particularly when requiring clarity on the determination of a lease and, more importantly, the liabilities that accrue under the terms of such lease. Padwick Properties Ltd v Punj Lloyd Ltd

Read More from: eSQUIRE Global Crossings

2 weeks 4 days ago
Are you addressing your digital assets when planning your Walworth County estate? Digital assets do not solely affect younger generations, they affect all generations. Now that our digital world involves social media, emails, online investing, cloud storage, and more, you must address what will happen to your digital assets after your death.   What Are The Various Types of Digital Assets? In general, digital assets consist of any type of information stored online, in the cloud, or on a person’s computer, phone, or server. Samples of digital assets are: emails (Outlook, Hotmail, Gmail), online investing information (E*Trade), online financial information, online bank accounts, online bill payment accounts (PayPal), social media profiles (Facebook, Twitter, Instagram), online photos, online videos, blogs, websites, domain names, online video game accounts, avatars, medical and prescription information (Patient Portals, Walgreens), all files storage on your computer, your smartphone data (address book, contacts, photos), etc. Some people may have digital assets with a monetary value, such as online businesses, photographers, authors, etc. Your digital property and memories will be lost if family members are unable to retrieve and access your data. Why Must I Protect and Plan for My Walworth County Digital Estate?

Read More from: Wynn at Law, LLC

2 weeks 4 days ago
On April 7, 2016, Pacific Sunwear of California, Inc. (aka PacSun, aka Pacific Sunwear) filed for chapter 11 protection in the United States Bankruptcy Court for the District of Delaware. Through the bankruptcy, Pacific Sunwear is seeking bankruptcy protection in order to get rid of two thirds of its debt and restore its balance sheet, according to CEO Gary Schoenfeld in a statement. Pacific Sunwear is also looking to reduce the cost of running its stores, either by negotiating with landlords or getting out of leases. Landlords need to pay close attention to this bankruptcy.  Pacific Sunwear has approximately 600 retail store locations across the country.  Not surprisingly, the Debtors have already filed a motion to establish procedures for rejecting executory contracts and unexpired leases. Whether Pacific Sunwear rejects store leases, or assumes the leases, the rights of Pacific Sunwear’s commercial landlords will invariably be impacted.  Below is a link to a previous post titled “Ten Things Every Commercial Landlord Should Know About a Tenant in Bankruptcy.”  This link provides a brief summary of some of the issues landlords should consider when a commercial tenant such as Pacific Sunwear files for bankruptcy.
2 weeks 4 days ago
Action Item.  Why not offer a Regional Mediation Hubs alternative to these VeraSun defendants?  Why not let them opt to mediate their disputes in one of three locations—Omaha, Minneapolis or Chicago—instead of Wilmington?  The extra cost of Regional Mediation Hubs to the bankruptcy estate should consist of some plane tickets and overnight lodgings for a handful of professionals.  And, if a local mediator is involved, surely that mediator could provide office and conference room space at no, or limited, additional charge.  Ok…it’s probably a little more complicated than that, but you get the picture.

Read More from: Mediatbankry

2 weeks 4 days ago
Do you have unpaid bills ?  This article outlines some good practical advice to follow when dealing with your bills and unpaid debt. If you have tried these tips, and are still having trouble, it may be time to talk with a bankruptcy lawyer. Most bankruptcy lawyers will be happy to discuss your situation without charge, offering what most call a “free consultation” to see if bankruptcy is an option. This “free” meeting can be a good use of  your time, as you may discover options available to you to deal with your bills … options that you did not know you had.
2 weeks 4 days ago
In a unanimous decision arising out of the Tribune Media Company bankruptcy cases, a panel of the Second Circuit held that the safe harbor under section 546(e) of the Bankruptcy Code, which precludes avoidance of certain transfers by a debtor to specified financial intermediaries in connection with a securities contract (unless there was intentional fraud), barred state law constructive fraudulent transfer claims asserted by individual creditors of Tribune even though the language of the statute refers only to claims of a “trustee,” i.e., the debtor in possession or an authorized estate representative.  The court found that, even though section 546(e) of the Bankruptcy Code does not expressly refer to individual creditors, the prosecution of state law claims by individual creditors that would be barred if prosecuted by the trustee in a bankruptcy proceeding were preempted and barred by federal bankruptcy law.  
2 weeks 4 days ago
In a published opinion entered on April 8, 2016, the Eleventh Circuit Court of Appeals held that District Courts are obliged to use and apply the Federal Rules of Bankruptcy Procedure rather than the Federal Rules of Civil Procedure when trying a case that “arises under” Title 11 (28 U.S.C. §1334).  In Rosenberg v. DVI Receivables, LLC, et al., No. 14-14620 (11th Cir.

Read More from: Georgia Bankruptcy Blog

2 weeks 4 days ago
It's easy to get lost in the technological complexity of "application programming interfaces," but banks need to stay focused on improving business and customer outcomes, which is the ultimate goal.

Read More from: BankThink

2 weeks 4 days ago
Tim Hassenger and Drew McManigle have joined advisory firm SierraConstellation Partners to help expand the firm’s presence in Texas. Mr. Hassenger, a partner in the Dallas office, has experience in studying turnaround trends and has advised on restructurings and legal issues. He has worked with clients in industries including aerospace, apparel and transportation. Mr. McManigle, managing director in the Houston office, has worked in operational leadership, financial restructurings and turnarounds. He has experience in the energy industry, including with oil and gas companies and fuel distributors. Steven Lammers has joined law firm SmithAmundsen as a partner with the Indianapolis office. Mr. Lammers represents creditors and banks in bankruptcy, foreclosures and loan workouts. He also is a member of the law firm’s health-care practice and represents health-care groups and individuals in litigation matters.

Read More from: WSJ.com: Bankruptcy Beat

2 weeks 4 days ago
Forman v. Moran Towing Corp. (In re AES Thames, LLC), Case No. 13-50395 (KJC), 2016 WL 853091 (Bankr. D. Del. Mar. 3, 2016) In this Memorandum, evidence that payments made during the preference period fell within historical ranges was enough for Judge Kevin Carey to rule that the timing was “subjectively” ordinary under section 547(c)(2)(A) of the Bankruptcy Code, even though the average timing compared unfavorably to the parties’ historical dealings.  The Court’s analysis sheds light on the “somewhat unique circumstances” in which a court may emphasize the importance of the range of payment timing for purposes of the ordinary course of business defense. Op. at *4. Read More › Tags: Avoidance & Turnover, Preferences

Read More from: Delaware Bankruptcy Insider

2 weeks 4 days ago
Another purported financial professional has confidently and conclusively gotten the bankruptcy means test absolutely dead wrong. And used that wrong conclusion to steer someone away from bankruptcy. Mt. St. Helens has nothing on me in terms of venting. How can financial professionals get this so wrong, ten years after the means test was enacted? Mangling the law It started off innocently enough when a reader asked Jane McNamara on FoxBusiness about the impact of settling an old debt  versus filing bankruptcy. She noted the possible tax consequences of a settlement and asked whether the money was really available to fund the settlement. So far, so good. But then she blew it, big time.
To qualify for a Chapter 7 filing in most cases your income must be lower than the median income for your state
Wrong, wrong, wrong. An income over the median income for your state just means you have to complete the means test.  It’s largely another form requiring more figures about your income and your projected expenses.
2 weeks 4 days ago
Receiving Wide Coverage ...

Read More from: BankThink

2 weeks 5 days ago
Several years after regulators began developing the "net stable funding ratio," there is good reason to ask if its utility has been eclipsed by other liquidity-related rules.

Read More from: BankThink

2 weeks 5 days ago
We have written previously (see below) about the topic of collection harassment and the federal law that prohibits illegal activities of debt collectors. You Can Sue Debt Collectors for Harassment The saying, “a picture is worth a thousand words” doesn’t quite fit here, but how about listening to debt collector phone calls?  These calls are brutal, illegal and, stunningly, so common that we don’t even blink an eye to them.  Our clients get these calls every single day and tell our lawyers about them every single day.  Reporter Jeff Rossen gives good advice here but he leaves out the fact that you can sue debt collectors for violations of the Fair Debt Collection Practices Act (FDCPA).  Our lawyers have been suing debt collectors under this law for several years.   By the way, pay special attention to the call received by a teacher at her school.  Many of our clients receive these type of illegal calls to their own employers, from schools to U.S. government offices.  Again, what is described here is activity that we hear about every single day in every one of our offices.

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

2 weeks 5 days ago
Upcoming Committee Formation Meeting:  April 19, 2016, 10:00 a.m. Case Name: Pacific Sunwear of California, Inc. Case Number:  16-10882 (LSS) Location: The Double Tree Hotel, 700 King Street, Salon C., Wilmington, DE 19801 Notice of Formation Meeting for Official Committee of Unsecured Creditors can be found here. The petitions (including consolidated list of top 40 creditors), first day declaration and dockets are available through Prime Clerk.  The debtors have published a press release regarding their reorganization. Contact Norman L. Pernick, Nicholas J. Brannick, or David W. Giattino for more information.
2 weeks 5 days ago
[wsj-responsive-image P="http://art.wsj.net/api/photos/37433922/smartcrop?height=499&width=749" J="http://art.wsj.net/api/photos/37433922/smartcrop?height=639&width=959" M="http://art.wsj.net/api/photos/37433922/smartcrop?height=853&width=1280" credit="Reuters" placement="Inline" suppressEnlarge="false" ] Gift retailer Things Remembered hired FTI Consulting Inc. as financial adviser to take a look at its operations. 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.”) DBR reports on Noranda Aluminum’s win over Sherwin Alumina on a Fight over a supply contract.

Read More from: WSJ.com: Bankruptcy Beat

2 weeks 5 days ago
Budget for mediation trip to Delaware By Donald L. Swanson Avoidance defendants from fly-over country believe they get a raw deal in mega-case mediations.  An example is In re VeraSun Energy Corporation, et al, Case No. 08-12606 in Delaware.  The VeraSun case involves eighteen ethanol production plants located throughout the corn producing areas of the United States.  After § 363 sales of Debtors’ assets, 156 transfer avoidance actions are filed and prosecuted to resolution by settlements—not one is actually tried. Of those 156 actions, 106 (68%) are filed against defendants in the following states, none of which is anywhere near Delaware: 25 from Minnesota 17 from Iowa 14 from Nebraska 13 from South Dakota 12 from Illinois 7 from Indiana 5 from North Dakota 5 from Kansas 4 from Missouri 4 from Michigan 4 from Wisconsin Imagine the total cost of sending all defendants in the 156 VeraSun actions, with attorneys, to Delaware for mediations.  It has to be a staggering number.  And the individual cost for many of the defendants must be prohibitive, especially for defendants in 79 of those actions (51%) who face claim amounts of less than $100,000.  Get this: –With less than $100,000 at stake, mediation sessions occurred in 7 of 79 adversaries—that’s 9%. –With more than $100,000 at stake, mediation sessions occurred in 28 of 77 adversaries—that’s 36%.

Read More from: Mediatbankry

2 weeks 5 days ago
      Homeowners association or condo association dues coming due after the bankruptcy is filed but before title to the property vests in the mortgage or association are a bane of debtor's counsel generally.   A recent case from Washington does not help the situation.  In PENNY D. GOUDELOCK, Appellant, v. SIXTY-01 ASSOCIATION OF APARTMENT OWNERS, Appellee., No. C15-1413-MJP, 2016 WL 1365942 (W.D. Wash. Apr. 6, 2016) the Debtor had filed a chapter 13 bankruptcy in March 2011, and provided for surrender of the condo, which she had moved out of.  The condo association had obtained relief from the automatic stay to foreclose based on past-due assessments, but the December 2012 sale was cancelled when the mortgage company caught up all assessments.  The property sat vacant until the mortgage company foreclosed in February 2015.  The Debtor received her chapter 13 discharge in June 2015.    The bankruptcy court, relying on In re Foster, 435 B.R. 650 (B.A.P. 9th Cir. 2010), found that the Debtor's post-petition condominium association dues and assessments were not dischargeable because they arose at the time of their assessment and were an incidence of legal ownership of the burdened property.

Read More from: Tampa Bankruptcy

2 weeks 5 days ago

Pages