3rd Circuit

District Court Disregards the Bankruptcy Court’s Authority over Post-Petition Fees

Seemingly in conflict with Section 329, a district court decided that a chapter 7 debtor’s attorneys could sue for post-petition fees, even though the firm never disclosed the fee arrangement as required by Section 329 and Rule 2016.

ERISA Claims Resolved in Bankruptcy Court, Not Through Arbitration

With two federal statutes in conflict, Delaware’s Judge Goldblatt found a rebuttable presumption in favor of enforcing arbitration.

Actual Notice Is Required for a Plan Injunction to Bind a Creditor

A creditor’s actual knowledge that a bankruptcy case exists isn’t enough for the creditor to be bound by a plan injunction, Delaware’s Judge Silverstein says.

Ritzen and Bullard Didn’t Change the ‘Pragmatic Approach’ to Bankruptcy Finality

Under binding circuit precedent, a Delaware district judge ruled that an order denying a motion to dismiss a chapter 11 case is final and appealable.

Shareholder Standing Scrutinized in a Case that Presages Truck Insurance

Can Section 327(c) be unconstitutional as applied if it deprives shareholders of standing when the estate might be solvent?

Third Circuit Creates a Common Law Alternative to Chapter 15

Prof. Westbrook believes there is no common law alternative to chapter 15.

Another Judge Rules that Federal Bankruptcy Law Preempts Delaware Law on LLCs

Like Bankruptcy Judge Lopez in Houston, Delaware’s Judge Goldblatt decided that Delaware law governing LLCs can’t eliminate rights that are fundamental in federal bankruptcy law.

Congress Must Act to Permit Chapter 7 Debtors to Pay Counsel After Filing

Bifurcated fee arrangements are cumbersome, temporary fixes for a problem that the Supreme Court created in Lamie.

Third Circuit Says: Bankruptcy Courts Have No Discretion to Deny Examiner Motions

Although examiners must be appointed on motion, the Third Circuit says that the bankruptcy court retains ‘broad discretion’ to fix the scope and cost of the investigation.

No Condemnation When Government Takes Over Property to Prevent Public Injury

No reverse condemnation occurred when the state took over a debtor’s property to prevent an imminent threat to public health.