Starting Dec. 1, anyone who files a motion to sell assets -- whether it's a billion-dollar business, a single corporate jet or a tiny plot of land -- will have to pay a $176 administrative fee, the Wall Street Journal reported on Saturday. The fee comes as federal courts face a funding crisis. Congress appropriates most of the federal judiciary's operating funds, so government budget cuts hit the judiciary hard. A small percentage of operating funds come from fees that the federal courts charge. It's clear that bankruptcy pays, generating about 79 percent of those fees, according to a recent report from the Judicial Conference of the United States. The conference's bankruptcy committee recommended the sale motion fee, deciding on a flat fee after considering tying the amount to the value of the sale, according to a committee report. The fee will specifically apply to motions to sell assets free and clear of liens, encumbrances and interests -- a lawyerly way of saying that the buyer will be able to leave behind anything tying up the assets in bankruptcy. Read more. (Subscription required.)
To view the full notice of the fee changes, please click here.
COMMENTARY: WHAT THE CONVERTIBLE DEBT BOOM MEANS FOR BANKRUPTCY
The boom in convertible debt in many respects means that the post-Lehman bond market bonanza is entering its last stage, according to a commentary yesterday by Prof. Stephen Lubben on the New York Times DealBook blog. Lubben expects that the number of big chapter 11 cases will rise to a more typical level, which raise a few questions. Law firm hiring is way down, and all indications are that restructuring departments are shrinking. And then there is the question of what the financial crisis and Dodd-Frank might do to the debtor-in-possession loan market. Some of the big players in this market are shrinking as a result of the crisis, and Dodd-Frank may encourage more of that. All of this is probably a year or two out, according to Lubben, since distressed companies will be able to coast for a while on their existing funding. Read the full commentary.
FORECLOSED SALES AT U.S. AUCTIONS DOUBLE AS PRICES GAIN
Purchases of foreclosed homes at auctions jumped last month as banks benefited from surging prices and shunned approvals of sales by homeowners dumping their dwellings at a loss, Bloomberg News reported yesterday. In October, about 20 percent of repossessed properties sold at U.S. auctions compared with 15 percent in July, said Daren Blomquist, vice president of Irvine, Calif.-based RealtyTrac. Auction deals accounted for 2.5 percent of all U.S. sales in October, almost doubling from a year earlier. Short sales, in which banks agree to accept less than what is owed on the property, comprised 5.3 percent of purchases, falling from 11 percent, data company RealtyTrac said in a report today. Investors have emerged as major landlords in Atlanta, Las Vegas and Phoenix -- cities hit hardest by the housing meltdown, where property values plummeted by as much as 50 percent. Banks have reduced their collection of repossessed homes by 26 percent to $7 billion from a year earlier, according to the Federal Deposit Insurance Corp. That's 50 percent of the level they held at the height of the foreclosure crisis at the end of 2010. Read more.
FDIC SAYS U.S. BANKING INDUSTRY CONTINUES SLOW REBOUND
The Federal Deposit Insurance Corp. said that the U.S. banking industry continued its recovery during the third quarter, reflecting the sector's gradual rebound from the 2008 financial crisis, the Wall Street Journal reported today. The FDIC said that it found "positive trends" across the industry, with overall growth in lending despite a slowdown in the pace of mortgage loans. JPMorgan Chase & Co.'s legal woes weighed on the third quarter figures, accounting for the bulk of a $1.5 billion drop in earnings for the third quarter of 2013 compared with the same period a year ago. The report said six banks failed in the third quarter, bringing the total to 22 for the year. In 2012, 43 banks failed. Banks showed growth in commercial and industrial loans as well as in auto loans and credit card balances. Read more. (Subscription required.)
NOW AVAILABLE FOR PRE-ORDER: BEST OF ABI 2013: THE YEAR IN BUSINESS BANKRUPTCY
Now available for pre-order in the ABI Bookstore is the Best of ABI 2013: The Year in Business Bankruptcy. This must-have reference contains the best ABI Journal articles and papers from ABI's top-rated educational seminars selected by ABI Resident Scholar Prof. Kara Bruce to cover the most important developments in business bankruptcy for 2013. The book delves into such timely topics as municipal bankruptcy, avoidance actions, intercreditor, confirmation and post-confirmation issues, jurisdiction and venue, and much more, and also features relevant case summaries drawn from ABI's Volo site (volo.abi.org). Make sure to log in to the site to get your discounted ABI member pricing. The book will ship in early December. Click here to order.
ABI GOLF TOUR UNDERWAY; LAST STOP FOR 2013 IS WINTER LEADERSHIP CONFERENCE NEXT WEEK!
The 7th and final stop for the 2013 ABI Golf Tour is on Dec. 5 at the Trump National Golf Club, held in conjunction with ABI’s Winter Leadership Conference. Final scoring to win the Great American Cup — sponsored by Great American Group — is based on your top three scores from the seven ABI events. See the Tour page for details and course descriptions. The ABI Golf Tour combines networking with fun competition, as golfers "play their own ball." Including your handicap means everyone has an equal chance to compete for the glory of being crowned ABI's top golfer of 2013! A 22-handicapper won the tour event at July’s Southeast Bankruptcy Workshop. There's no charge to register or participate in the Tour.
NEW ABILIVE WEBINAR LOOKS AT HOW TO HIRE THE RIGHT FINANCIAL ADVISORS
ABI's Financial Advisors & Investment Banking Committee
is proud to present the next abiLIVE webinar, "How to Hire the Right Financial Advisors," on Dec. 11 from 1-2:15 p.m. ET. The program will provide attendees with an overview and basic understanding of the different types of financial advisors that may be relevant for in- and out-of-court cases. Topics include:
- The different types of financial advisors available;
- The benefits and limitations for each category of advisor; and
- How to select the right advisor for the job.
Speakers on the webinar include:
-Daniel F. Dooley of MorrisAnderson (Chicago)
-Gregory S. Hays of Hays Financial Consulting LLC (Atlanta)
-Ivan Lehon of Ernst & Young (New York)
-Allen Soong of Deloitte CRG (Los Angeles)
-Teri Stratton of Piper Jaffray & Co. (El Segundo, Calif.)
Registration is $75 for ABI members/$175 for non-members. Have a number of colleagues that would like to participate? Take advantage of group pricing for ABI members: register 5 or more and the registration cost drops to $60 per person!
Beginning in January 2014, ABI will institute its first dues increase to the regular dues rate in six years. The $20 increase will ensure that ABI can continue to provide you with the latest and most effective tools available in insolvency information and education. You can lock in 2013 rates, and additional discounts, for up to three years by using a multi-year renewal option (save $75!). You can also save 10 percent on future dues by opting into the automated dues program. To renew your membership and save, please go to renew.abi.org.
ABI LAUNCHES SIXTH ANNUAL WRITING COMPETITION FOR LAW STUDENTS
Law school students are invited to submit a paper between now and March 4, 2014 for ABI's Sixth Annual Bankruptcy Law Student Writing Competition. ABI will extend a complimentary one-year membership to all students who participate in this year's competition. Eligible submissions should focus on current issues regarding bankruptcy jurisdiction, bankruptcy litigation, or evidence issues in bankruptcy cases or proceedings. The first-place winner, sponsored by Invotex Group, Inc., will receive a cash prize of $2,000 and publication of his or her paper in the ABI Journal. The second-place winner, sponsored by Jenner & Block LLP, will receive a cash prize of $1,250 and publication of his or her paper in an ABI committee newsletter. The third-place winner, sponsored by Thompson & Knight LLP, will receive a cash prize of $750 plus publication of his or her paper in an ABI committee newsletter. For competition participation and submission guidelines, please visit http://papers.abi.org.
NEW CASE SUMMARY ON VOLO: U.S. V. PRINCE (5TH CIR.)
Summarized by Craig Geno of Craig M Geno PLLC
The Fifth Circuit affirmed the District Court's evidentiary, effective assistance of counsel and speedy trial rulings and affirmed the appellant's convictions for bank fraud, money laundering, perjury and bankruptcy fraud.
There are more than 1,000 appellate opinions summarized on Volo, and summaries typically appear within 24 hours of the ruling. Click here regularly to view the latest case summaries on ABI’s Volo website.
NEW ON ABI’S BANKRUPTCY BLOG EXCHANGE: VENUE TAKES CENTER STAGE AT ABI CHAPTER 11 COMMISSION HEARING
The Bankruptcy Blog Exchange is a free ABI service that tracks more than 80 bankruptcy-related blogs. A recent blog post provides a recap of the Nov. 22 hearing of ABI's Commission to Study the Reform of Chapter 11.
For witness testimony and a video of the hearing, please be sure to visit http://commission.abi.org.
Be sure to check the site several times each day; any time a contributing blog posts a new story, a link to the story will appear on the top. If you have a blog that deals with bankruptcy, or know of a good blog that should be part of the Bankruptcy Exchange, please contact the ABI Web team.
ABI Quick Poll
A holder of an unstayed judgment, which is subject to an ongoing appeal, can qualify as a petitioning creditor under § 303(b)(1).
Click here to vote on this week's Quick Poll. Click here to view the results of previous Quick Polls.
INSOL INTERNATIONAL
INSOL International is a worldwide federation of national associations for accountants and lawyers who specialize in turnaround and insolvency. There are currently 43 member associations worldwide with more than 9,000 professionals participating as members of INSOL International. As a member association of INSOL, ABI's members receive a discounted subscription rate. See ABI's enrollment page for details.
