SUPREME COURT TAKES CASE THAT WILL DIRECTLY IMPACT CFPB, FDIC
The Consumer Financial Protection Bureau – which oversees regulations for mortgages and other credit products – and a major bank regulator will be closely watching the Supreme Court this fall, Marketwatch.com reported on Tuesday. The Supreme Court on Monday decided to hear Noel Canning v. NLRB about whether the White House recess appointments for the labor board violated the Constitution. The Court's decision on the case will also impact the appointment of Richard Cordray, who directs the CFPB, since he was installed at the bureau in the same controversial way as the NLRB nominees. All this means that the consumer bureau’s existing rules for mortgages and future rules could be in doubt. Without Cordray, the bureau won’t be able to write or enforce rules on many mortgage lenders, payday lenders, credit-reporting bureaus and debt collectors. However, it could still enforce existing consumer laws on many banks and credit card companies. Cordray is also a Democratic member of the five-person bipartisan Federal Deposit Insurance Corp. A decision by the court to invalidate the NLRB nominations could also impact the validity of any big bank capital rules that Cordray votes to approve as a member of the bank regulator. The D.C. Circuit ruled in January that President Obama lacked the power to make recess appointments without Senate consent. The NLRB appealed that ruling in March. The litigation battle comes after Cordray and the NLRB board nominees cannot win the 60 votes needed to be approved by the Senate over the past couple of years. Read more.
SURVEY: LAWYER FEES INCREASED LAST YEAR
Legal fees rose 10 percent from 2010 to 2012 and increased 4.8 percent last year, according to a survey by Tymetrix and CEB, which looked at billing information from more than 4,800 law firms and 99,000 lawyers, Bloomberg News reported yesterday. Finance and securities rates increased the most last year, at 5.8 percent, while general corporate, intellectual property, and mergers and acquisitions had increases of 4 percent and 5 percent on average, according to the survey. The largest law firms and those in the most expensive U.S. cities had the greatest increases. Large law firms increased their rates by 5.6 percent, on average two times the rate of firms with fewer than 100 lawyers, according to the survey. In New York City, Washington, D.C., Boston, Dallas, Los Angeles and Houston, increases were between 5 percent and 6 percent last year. Read more.
CONSUMER SPENDING IN U.S. REBOUNDS AS INCOMES INCREASE
Consumer spending in the U.S. rebounded in May following the largest drop in more than three years, a sign that the biggest part of the economy will largely affect growth this quarter, Bloomberg News reported today. Household purchases, which account for about 70 percent of the economy, rose 0.3 percent after a 0.3 percent decline the prior month that was the biggest since September 2009, Commerce Department figures showed today. Consumer purchases were trimmed to a 2.6 percent advance – still the fastest in two years – from the 3.4 percent gain estimated last month as Americans cut back on services from vacations to legal advice. The saving rate increased to 3.2 percent from 3 percent. At the same time, wages and salaries climbed 0.3 percent. Disposable income, or the money left over after taxes, increased 0.4 percent after adjusting for inflation, today’s report showed. Read more.
ANALYSIS: COST OF PUBLIC PROJECTS IS RISING, AND PAIN WILL BE FELT FOR YEARS
Interest rates have been inching up everywhere, sending America’s vast market for municipal bonds, a crucial source of financing for roads, bridges, schools and more, into its steepest decline since the dark days of the financial crisis in 2008, the New York Times DealBook blog reported today. For one state, Illinois, the higher interest rates will add up to $130 million over the next 25 years — and that is for just one new round of borrowing. All told, the interest burden of states and localities is likely to grow by many billions, sapping tax dollars that might otherwise have been spent on public services. Over the last few days, Georgia, Philadelphia, the Metropolitan Transportation Authority in New York and others have delayed sales of new bonds, citing the precipitous plunge in prices that is driving up interest rates. Illinois Governor Pat Quinn (D) attributed the extra cost to the state’s failure to shore up its finances, particularly its rickety pension system. Illinois has the lowest credit rating of any state, and as interest rates rise they tend to rise fastest for the weakest borrowers. Read more.
LATEST BLOOMBERG "BILL ON BANKRUPTCY" VIDEO: SUPREME COURT CASES WILL HAVE WIDE IMPACT
NEW ABI LIVE WEBINAR ON JULY 15 WILL FOCUS ON THE § 1111(b) ELECTION, PLAN FEASIBILITY AND CRAMDOWN ISSUES
Utilizing a case study, ABI's panel of experts will explore issues surrounding a lender’s decision on whether or not to make an election under § 1111(b), plan feasibility and voting. The abiLIVE panel will also walk attendees through the necessary mathematical analyses used to analyze these issues. The webinar will take place on July 15 from 1-2:15 p.m. ET. Special ABI member rate available! Click here to register.
ABI GOLF TOUR UNDERWAY; NEXT STOP IS THE NORTHEAST BANKRUPTCY CONFERENCE ON JULY 12
The next stop for the ABI Golf Tour is the famed Newport National course in Newport, R.I., in conjunction with the Northeast Bankruptcy Conference on July 12. Final scoring to win the Great American Cupsponsored by Great American Groupis based on your top three scores at seven scheduled ABI events, so play as many as you can before the tour wraps up at the Winter Leadership Conference in December. 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! There's no charge to register or participate in the Tour.
NEW ABI "BANKRUPTCY IN DEPTH" ON-DEMAND CLE PROGRAM LOOKS AT PRINCIPLES OF PROPERTY OF THE ESTATE: DEMYSTIFYING EQUITABLE INTERESTS
In this 90-minute seminar, Profs. Andrew Kull of Boston University School of Law and Scott Pryor of Regent University School of Law provide an in-depth analysis of a legal principle that has become, in their words, "a long-lost area of the law": § 541 of the Bankruptcy Code. Seeking to demystify what is meant by "property of the estate" and, in particular, the distinction between legal or equitable interests of the debtor in property, Kull and Pryor describe the legal entanglements that ensue when legal title belongs to one person but the equitable title belongs to someone else. The cost of the seminar, which includes written materials and qualifies for 1.5 hours of CLE, is $95. To order or to learn more, click here.
ASSOCIATES: ABI'S NUTS & BOLTS ONLINE PROGRAMS HELP YOU HONE YOUR SKILLS WHILE SAVING ON CLE!
Associates looking to sharpen their bankruptcy knowledge should take advantage of ABI's special offer of combining general, business or consumer Nuts & Bolts online programs. Each program features an outstanding faculty of judges and practitioners explaining the fundamentals of bankruptcy, offering procedures and strategies tailored for both consumer and business attorneys. Click here to get the CLE you need at a great low price!
NEW CASE SUMMARY ON VOLO: GROUND IMPROVEMENT TECHNIQUES, INC. V. THE PLAN COMMITTEE (IN RE WASHINGTON GROUP INTERNATIONAL, INC.; 9TH CIR.)
Summarized by Jamie Edmonson of Venable LLP
The Ninth Circuit affirmed the ruling of the district court that § 502(b)(2) does not alter the liability of a nondebtor third party.
There are more than 900 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: SAYING GOODBYE TO FANNIE AND FREDDIE?
The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A recent blog post takes a closer look at the “Secondary Mortgage Market Reform and Taxpayer Protection Act of 2013,” introduced this week by Sens. Bob Corker (R-Tenn.) and Mark Warner (D-Va.). The bill proposes winding down Fannie Mae and Freddie Mac and replacing them with a new government agency called the Federal Mortgage Insurance Company (the “FMIC”).
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
Law firms should provide support for law student-staffed bankruptcy clinics for consumer debtors.
Click here to vote on this week's Quick Poll. Click here to view the results of previous Quick Polls.
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