Business Reorganization

Report Bankruptcy Bidder Protections Climbed in 2012

ABI Bankruptcy Brief | May 30 2013
 
  

June 4, 2013

 
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  NEWS AND ANALYSIS   

REPORT: BANKRUPTCY BIDDER PROTECTIONS CLIMBED IN 2012

A report from Morgan Joseph TriArtisan LLC, an investment bank that focuses on the middle market, found that bankruptcy bidder protections hit their highest level in recent years, the Wall Street Journal Bankruptcy Beat blog reported today. The report found that the average amount of bidder protections a company offered its lead bidder last year was 4.4 percent of the purchase price, while average bidder protections between 2008 and 2011 hovered between 3.5 and 3.7 percent. (They were a low 2.6 percent in 2007, before the economic downturn hit.) Bidder protections include the break-up fee that a company pays its stalking-horse bidder, as well as expense reimbursements, which cover the legal and due-diligence fees a stalking horse incurs as it puts its bid together. The average break-up fee last year was 3.7 percent of the purchase price compared to 2.5-2.9 percent in prior years, while the average expense reimbursement was 2.3 percent versus a past range of 0.4-1.6 percent. Read the full report.

COMMENTARY: A BETTER WAY TO END "TOO BIG TO FAIL"

Big banks and their defenders insist that the changes proposed in the Terminating Bailouts for Taxpayer Fairness Act—which would require them to boost the value of their stock and other equity to 15 percent of the value of their total assets—are unnecessary and would have dangerous consequences for the U.S. economy and our financial competitiveness, according to a commentary by Prof. David Skeel in today's Wall Street Journal. Both of these claims are wrong, according to Skeel, but in making them, the banks have accidentally pointed the way to a far more promising strategy for finally ending "too big to fail." Sens. Sherrod Brown (D-Ohio) and David Vitter (R-La.) introduced the Terminating Bailouts for Taxpayer Fairness Act on April 24, which would require U.S. financial institutions with more than $500 billion in assets to substantially increase their "equity capital." The banks further insist that Brown-Vitter would force them to cut back their lending to businesses just as the U.S. economic recovery is getting underway, and to shed assets to create the required 15 percent capital buffer. But as Bank of England's Robert Jenkins has argued, it is a widely held myth that banks reduce lending simply because capital obligations are increased. Still, according to Skeel, the giant banks' concerns do suggest a friendly amendment to Brown-Vitter: Rather than force them to fit the same 15 percent capital mode, why not let them choose either to comply with Brown-Vitter's capital requirements, or to downsize to a specific maximize size within five years of the enactment of the legislation? Read the full commentary. (Subscription required.)

LEGISLATION AIMS TO ENSURE MEDICAL-DEBT ACCURACY IN CREDIT REPORTS

Rep. Gary Miller (R-Calif.) on May 24 introduced legislation to give consumers more time to ensure that only accurate medical debt is reported to credit bureaus, according to a press release from Miller's office. H.R. 2211, the "Accuracy in Reporting Medical Debt Act," aims to ensure that consumers have ample time to resolve medical billing questions and potential errors before medical debt can be reported to the credit bureaus. The Accuracy in Reporting Medical Debt Act would delay the ability of a debt collector to report medical debt to a credit bureau if the consumer notifies the debt collector that:

• the consumer is continuing to work with an insurance company;

• the consumer did not know that the debt existed; or

• the consumer has applied for financial assistance.

To read the full copy of H.R. 2211, please click here.

COMMENTARY: SHADES OF 2007 BORROWING

American investors have taken out more margin loans than ever before, indicating that speculative investing has grown among retail investors, reaching levels that in the past indicated that the market was getting to unsustainable levels and might be in for a fall, according to a commentary in Saturday's New York Times. The amount owed on loans secured by investments rose to $384 billion at the end of April, according to data compiled by the Financial Industry Regulatory Authority (FINRA). It was the first time the total had surpassed the 2007 peak of $381 billion, a peak that was followed by the Great Recession and credit crisis. The latest total of borrowing amounts to about 2.4 percent of GDP, a level that in the past was a danger signal. Rising margin debt was once seen as a primary indicator of financial speculation, and the Federal Reserve controlled the amount that could be borrowed by each investor as a way to dampen excess enthusiasm when markets grew frothy. But the last time the Fed adjusted the margin rules was in 1974, when it reduced the down payment required for stocks to 50 percent of the purchase price from 65 percent. That came about during a severe bear market. Read more.

ABI WEBSITE (ABI.ORG) WILL BE DOWN THIS WEEKEND FOR SCHEDULED MAINTENANCE

From 10 p.m. ET on Friday, June 7, through Sunday evening, June 9, the ABI homepage (abi.org) will be down for scheduled maintenance. During this period, members will not be able to access certain features, including registering for conferences, printing and viewing CLE certificates, and purchasing publications. Other ABI sites, like Search.abi.org, Volo.abi.org, Journal.abi.org, law.abi.org, blogs.abi.org and news.abi.org, will be operational during this time, but users may experience limited functionality. ABI intends to limit this downtime as much as possible. If you have any questions, please email [email protected]

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!

ABI GOLF TOUR UNDERWAY; NEXT STOP IS CENTRAL STATES BANKRUPTCY WORKSHOP IN JUNE

Rob Schwartz and Scott Gautier are tied at 34 Stableford Points atop the closely bunched leaderboard after the ABI Golf Tour's first stop at Lake Presidential Golf Club. Next up for the Tour is the famed Bear course at the Grand Traverse Resort at the Central States Bankruptcy Workshop on June 14. Final scoring to win the Great American Cup—sponsored by Great American Group—is 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, and women are most welcome.

ABI IN-DEPTH

NEW CASE SUMMARY ON VOLO: FADEL V. DCB UNITED LLC (IN RE FADEL; 9TH CIR.)

Summarized by Mark Hudson of Schian Walker PLC

The Ninth Circuit BAP affirmed the bankruptcy court's granting of relief from the automatic stay to permit a purchaser at a foreclosure sale to pursue a forcible detainer action against the debtor in state court and denying motion for reconsideration.

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: FURTHER EXAMINATION OF THE SUPREME COURT'S RULING IN BULLOCK V. BANKCHAMPAIGN

The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A recent blog post provides further examination of the Supreme Court's ruling on May 13 in the case of Bullock v. BankChampaign, N.A.

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

Bankruptcy courts should implement constructive trusts in any case where applicable state law would recognize them.

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 37 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.

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FRIDAY:

 

 

Memphis 2013
June 7, 2013
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COMING UP

 

 

 

CSBW 2013
June 13-16, 2013
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Golf Tournament 2013
June 14, 2013
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INSOL’s Latin American Regional Seminar in São Paulo, Brazil
June 13, 2013
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NE 2013
July 11-14, 2013
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SEBW 2013
July 18-21, 2013
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MA 2013
Aug. 8-10, 2013
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SW 2013
Aug. 22-24, 2013
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NYIC Golf Tournament 2013
Sept. 10, 2013
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Endowment Baseball 2013
Sept. 12, 2013
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VFB2013
Sept. 27, 2013
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MW2013
Oct. 4, 2013
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Endowment Football 2013
Oct. 6, 2013
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Detroit
Nov. 11, 2013
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40-Hour Mediation Program
Dec. 8-12, 2013
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  CALENDAR OF EVENTS
 

2013

June
- Memphis Consumer Bankruptcy Conference
     June 7, 2013 | Memphis, Tenn.
- Central States Bankruptcy Workshop
     June 13-16, 2013 | Grand Traverse, Mich.
- INSOL’s Latin American Regional Seminar
     June 13, 2013 | São Paulo, Brazil
- Charity Golf Tournament
     June 14, 2013 | City of Industry, Calif.

July
- Northeast Bankruptcy Conference and Northeast Consumer Forum
     July 11-14, 2013 | Newport, R.I.
- Southeast Bankruptcy Workshop
     July 18-21, 2013 | Amelia Island, Fla.

August
- Mid-Atlantic Bankruptcy Workshop
    August 8-10, 2013 | Hershey, Pa.
- Southwest Bankruptcy Conference
    August 22-24, 2013 | Incline Village, Nev.


  


September
- ABI Endowment Golf & Tennis Outing
    Sept. 10, 2013 | Maplewood, N.J.
- ABI Endowment Baseball Game
    Sept. 12, 2013 | Baltimore, Md.
- Bankruptcy 2013: Views from the Bench
    Sept. 27, 2013 | Washington, D.C.

October
- Midwestern Bankruptcy Institute Program and Midwestern Consumer Forum
    Oct. 4, 2013 | Kansas City, Mo.
- ABI Endowment Football Game
    Oct. 6, 2013 | Miami, Fla.

November
- Detroit Consumer Bankruptcy Conference
   Nov. 11, 2013 | Detroit, Mich.

December
- ABI/St. John’s Bankruptcy Mediation Training
    Dec. 8-12, 2013 | New York


 
 
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Big U.S. Banks Get Three-Month Extension for Living Wills

ABI Bankruptcy Brief | April 16 2013
 
  

April 16, 2013

 
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  NEWS AND ANALYSIS   

BIG U.S. BANKS GET THREE-MONTH EXTENSION FOR "LIVING WILLS"

The Federal Reserve and Federal Deposit Insurance Corp. gave large U.S. banks an additional three months to draw up "living wills" to assist regulators in winding them down in case of a future insolvency, Bloomberg News reported yesterday. The agencies also provided new details on what information the living wills should contain, including obstacles that might arise from taking the banks apart safely under the Bankruptcy Code, according to a statement today from the regulators. The documents, originally due July 1, are now due Oct. 1. Institutions with non-bank assets greater than $250 billion had to file their plans last year. Those 11 banks, including JPMorgan Chase & Co., Bank of America Corp. and Goldman Sachs Group Inc., must now provide a second version of the living will, and a group of the next-largest banks must file for the first time. Regulators are looking for more detailed information on "global issues, financial market utility interconnections, and funding and liquidity… to provide analysis to support the strategies and assumptions contained in the firms' resolution plans," according to the statement. Read more.

COMMENTARY: PUBLIC PENSIONS IN BANKRUPTCY COURT

Devastated by the recession, the city of Stockton, Calif., is trying to renegotiate its debts in a bankruptcy case that could set an important precedent on whether courts can forcibly reduce the pensions of government employees, according to a New York Times editorial on Sunday. Even after drastic cuts to city services that have sent the crime rate soaring, the city of 300,000 people about 80 miles east of San Francisco has an annual budget deficit of $26 million. It has laid off a quarter of its police force, which has meant that officers often respond only to crimes in progress. To fix its finances, Stockton is asking the bankruptcy court to restructure debts totaling about $250 million. But the city’s creditors, which include bondholders and insurance companies that have guaranteed some of its bonds, want the city to reduce the $30 million it spends annually on pension benefits for its 2,400 retirees. The California Public Employees’ Retirement System, which manages Stockton’s pensions, argues that the state’s Constitution and court rulings forbid state and local governments from ever lowering the pensions of retirees and current employees. The creditors assert that federal bankruptcy law, which lets judges break contracts, should trump state law. So far, city officials have said they do not intend to trim pensions, though they have reduced health benefits for retirees. Many legal analysts say that the Stockton case could eventually be appealed to the Supreme Court. While a Supreme Court decision would help clarify an important area of the law, a drawn-out court case is the last thing Stockton needs, according to the editorial. The way to get the city back on its feet is for city officials, creditors and retirees to negotiate a fair settlement quickly. Read the full editorial.

AMERICAN DREAM ELUDING THOSE WITH STUDENT DEBT BURDENS

Two-thirds of student loans are held by people under the age of 40, according to the Federal Reserve Bank of New York, blocking millions of them from taking advantage of the most affordable housing market on record, Bloomberg News reported on Saturday. The number of people in that age group who own homes fell by 4.6 percent in the fourth quarter from the third, the biggest drop in records dating to 1982. The issue is being exacerbated by an explosion in the $150 billion private market for student debt, with interest rates for some existing loans surpassing 12 percent. Unlike mortgage-holders, borrowers have little hope of refinancing at lower rates. Interest on some new federal loans is set to double to 6.8 percent in July if Congress does not extend the current rate, as it did last year. Read more.

COMMENTARY: CAN DODD-FRANK FIX MORTGAGE SERVICING IF WE DO NOT KNOW WHAT WENT WRONG?

A new obstacle has arrived for those seeking justice for past wrongdoing in the mortgage-servicing industry and those looking to prevent trouble in the future: federal regulators blocking the release of records they have collected documenting illegal abuses, according to a commentary in the Washington Post on Sunday. A heated exchange broke out at a Senate hearing last week, when Sen. Elizabeth Warren (D-Mass.) asked regulators from the Office of the Comptroller of the Currency (OCC) and the Federal Reserve why they were not sharing the results of their investigations into mortgage-servicing abuses and illegal activities with Congress and the people who were subject to abuses. These investigations began two years ago, after the OCC found that there were "violations of applicable federal and state law" that had "widespread consequences" in the servicer markets at 14 large banks. This Independent Foreclosure Review (IFR) wrapped up suddenly earlier this year, and it is not clear what it found, according to the commentary, although the servicers did manage to spend $2 billion on consultants. According to the latest letter from Warren and Rep. Elijah Cummings (D-Md.), regulators at the Federal Reserve argued that their documents showing illegal behavior are "trade secrets" of mortgage-servicing companies, while the OCC argues that this violates disclosure requirements. Click here to read the full commentary.

RECORD-LOW DEFAULTS MAY NOT BE GOOD NEWS

In December 2008, investors expected a default Armageddon after global "junk" bond yields spiked to over 20 percent, but the last decade has seen the lowest default rate on record in the modern era, according to an analysis by the Wall Street Journal today. The power of central banks and governments lies behind this remarkable turnaround—but it may come with a price. The average annual Moody's default rate since 2003 for single-B rated companies, the largest part of the high-yield market, stands at just 1.6 percent, Deutsche Bank noted. That's the lowest rolling 10-year rate since the market became full-fledged in the early 1980s, and compares with an annual average of 5 percent since 1983. In fact, nine of the past 10 years have seen single-B defaults mostly at below average, with six of them defaults of 1 percent or below—a rate never achieved between 1980 and 2003. The decade falls into two halves: From 2003 to 2007, the credit bubble drove default rates down, but since early 2009, central banks and governments have re-inflated this bubble, pushing down yields and making refinancing possible on easy terms for high-yield companies—despite sharply lower growth and, indeed, a renewed recession in Europe. Read more. (Subscription required.)

LATEST ABI PODCAST EXPLORES THE DEPTHS OF DEEPENING INSOLVENCY

The latest ABI podcast features ABI Resident Scholar Prof. Scott Pryor talking with Prof. Jack Williams and Kathy Phelps, the authors of ABI's publication The Depths of Deepening Insolvency: Damage Exposure for Officers, Directors and Others. Williams and Phelps offer a historical analysis of the “deepening insolvency” principle, its significance in calculating damages in a variety of liability scenarios, and the interplay of the doctrine with the fiduciary duties of company executives. Click here to listen to the podcast.

To order a copy of The Depths of Deepening Insolvency: Damage Exposure for Officers, Directors and Others, click on the banner below:

 

ASM MOBILE WEB APP NOW AVAILABLE FOR SMARTPHONES AND TABLETS!

The official Annual Spring Meeting mobile web app, sponsored by Diamond McCarthy LLP, is now available for iOS, Android and Blackberry devices! Utilize the app during ASM next week to view your personal schedule, browse what programs are taking place or to search for information related to the meeting. The mobile web app stores the schedule data locally on your phone for offline access too.

To take advantage of the ASM web app, bookmark the following address on your device’s browser: http://31stannualspringmeeting2013.sched.org/mobile

Haven’t registered for next week’s Annual Spring Meeting? Hurry, the hotel block at the Gaylord National Resort and Convention Center in National Harbor, Md., is almost sold out! ASM features a roster of the best national speakers, while the depth and scope of topics offer something for everyone. Specifically, four concurrent workshops will cover various “tracks,” including programs for attorneys in commercial cases, a track for restructuring professionals, a track of professional development programming and a track dealing solely with consumer issues. More than 16 hours of CLE/CPE is offered in some states, along with ethics credit totaling 3 hours, making the cost only about $50 per credit. In addition, committee sessions will drill down on other topics to provide you with the most practical and varied CLE/CPE experience ever. Sessions include:

• 17th Annual Great Debates
• Mediation: An Irrational Approach to a Rational Result
• Creditors’ Committees and the Role of Indenture Trustees and Related Issues
• Current Issues for Financial Advisors in Bankruptcy Cases
• The Individual Conundrum: Chapter 7, 11 or 13?
• The Power to Veto Bankruptcy Sales
• Real Estate Issues in Health Care Restructurings
• How to Be a Successful Expert
• The Ethical Compass: Multiple Ethical Schemes Applicable to Financial Advisors
• Chapter 9s, Nonprofits and Other Nontraditional Restructuring Processes
• And much more!

The Spring Meeting will also feature a field hearing of the ABI Commission to Study the Reform of Chapter 11, a report from the ABI Ethics Task Force, a luncheon panel discussion moderated by Bill Rochelle of Bloomberg News, and a Final Night Gala Dinner featuring a concert by Joan Jett and the Blackhearts!

Make sure to register today!

ABI IN-DEPTH

NEW ABI LIVE WEBINAR ON MAY 29 WILL FOCUS ON CONSUMER CLASS ACTIONS

Class action lawsuits in chapter 13 cases are becoming more prevalent. Are you wondering whether your client's claims would be better pursued in a class action? If your client is a defendant in a consumer class action, do you know what your client's best defenses are against class certification? ABI's panel of experts on May 29 from 1-2:15 p.m. ET will explore the potential benefits and pitfalls of class actions by debtors/trustees against creditors in chapter 13 cases by highlighting two recent appeals court decisions. Special ABI member rate available! Click here to register.

LATEST CASE SUMMARY ON VOLO: STEPHEN V. MAY (IN RE STEPHEN; 9TH CIR.)

Summarized by Emil Khatchatourian of the U.S. Bankruptcy Court for the Eastern District of California

Affirming the bankruptcy court, the Ninth Circuit Bankruptcy Appellate Panel held that the bankruptcy court did not err in dismissing the debtor's case because the debtor did not establish that he was entitled to relief from automatic dismissal for his failure to file a complete list of creditors and schedule of assets and liabilities within 45 days of the filing of his bankruptcy petition.

There are more than 800 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: SECTION 903 - IN CHAPTER 9, DOES FEDERAL LAW TRUMP STATE LAW, OR VICE VERSA?

The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A recent post examines the fight that is brewing in San Bernardino, Calif., regarding the scope of §903 of the Bankruptcy Code. It stems from the motions filed by the San Bernardino Public Employees Association (SBPEA), the San Bernardino Police Officers Association (SBPOA) and the San Bernardino City Professional Firefighters (SBCPF) in response to the city’s motion to reject collective bargaining agreements with these unions.

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.

TEE OFF ON THE NEW ABI GOLF TOUR!

Starting with the Annual Spring Meeting, ABI will offer conference registrants the option to participate in the ABI Golf Tour. The Tour will take place concurrently with all conference golf tournaments. The Tour is designed to enhance the golfing experience for serious golfers, while still offering a fun networking opportunity for players of any ability. As opposed to the format used at ABI’s regular conference events, Tour participants will "play their own ball." They will be grouped on the golf course separately from other conference golf participants and will typically play ahead of the other participants, expediting Tour play. Tour participants will be randomly grouped in foursomes, unless otherwise requested of the Commissioner in advance of each tournament. Prizes will be awarded for each individual Tour event, which are sponsored by Great American Group. The grand prize is the "Great American Cup," also sponsored by Great American Group, which will be awarded to the top player at the end of the Tour season. Registration is free. Click here for more information and a list of 2013 ABI Golf Tour event venues.

ABI Quick Poll

The scope of protection of "financial contracts" in bankruptcy should be rolled back to what it was before BAPCPA expanded it in 2005.

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 37 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.

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THURSDAY:

 

 

 

ASM 2013
April 18-21, 2013
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ASM NAB 2013
April 18, 2013
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COMING UP

 

 

 

NYCBC 2013
May 15, 2013
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ASM 2013
May 16, 2013
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ASM 2013
May 21-24, 2013
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ABI Live Webinar Examining Consumer Class Actions!
May 29, 2013
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ASM 2013
June 7, 2013
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ASM 2013
June 13-16, 2013
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NE 2013
July 11-14, 2013
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ASM 2013
July 18-21, 2013
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MA 2013
Aug. 8-10, 2013
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  CALENDAR OF EVENTS
 

2013

April
- "Nuts and Bolts" Program at ASM
     April 18, 2013 | National Harbor, Md.
- Annual Spring Meeting
     April 18-21, 2013 | National Harbor, Md.

May
- "Nuts and Bolts" Program at NYCBC
     May 15, 2013 | New York, N.Y.
- ABI Endowment Cocktail Reception
     May 15, 2013 | New York, N.Y.
- New York City Bankruptcy Conference
     May 16, 2013 | New York, N.Y.
- Litigation Skills Symposium
     May 21-24, 2013 | Dallas, Texas
- ABI Live Webinar: Consumer Class Actions
     May 29, 2013


  

 

June
- Memphis Consumer Bankruptcy Conference
     June 7, 2013 | Memphis, Tenn.
- Central States Bankruptcy Workshop
     June 13-16, 2013 | Grand Traverse, Mich.

July
- Northeast Bankruptcy Conference and Northeast Consumer Forum
     July 11-14, 2013 | Newport, R.I.
- Southeast Bankruptcy Workshop
     July 18-21, 2013 | Amelia Island, Fla.

August
- Mid-Atlantic Bankruptcy Workshop
    August 8-10, 2013 | Hershey, Pa.


 
 
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ABI Media Teleconference Examines Lessons Learned from Lehmans Chapter 11

ABI Bankruptcy Brief | September 12, 2013
 
  

September 12, 2013

 
home  |  newsroom  |  chart of the day  |  blogs  |  bankruptcy code and rules  |  statistics  |  legislative news  |  volo
  NEWS AND ANALYSIS   

ABI MEDIA TELECONFERENCE EXAMINES LESSONS LEARNED FROM LEHMAN’S CHAPTER 11

ABI held a media teleconference today looking at the Lehman chapter 11 filing, the lessons learned from it five years later and what the future holds for distressed large financial institutions. An audio archive of the teleconference will be posted soon on ABI.org, and its availability will be announced via social media (Twitter: twitter.abi.org; Facebook: facebook.abi.org). Key figures in the case who spoke on today's teleconference included:

- Bankruptcy Judge James Peck (S.D.N.Y.; New York) presided over the Lehman Brothers chapter 11 case.
- Harvey Miller of Weil, Gotshal & Manges LLP (New York) was the lead debtor attorney for Lehman Brothers.
- Dennis Dunne of Milbank, Tweed, Hadley & McCloy (New York) represented unsecured creditors in the Lehman case.
- Bryan Marsal of Alvarez and Marsal (New York) served as Lehman's Chief Executive Officer after it filed for chapter 11 until 2012.
- Chris Kiplock of Hughes Hubbard & Reed LLP (New York) worked with the team of attorneys representing trustee James W. Giddens in liquidating Lehman Brothers.

The moderator for the program was ABI Fall Resident Scholar Kara Bruce of Toledo University School of Law. Be sure to check ABI's feeds on Twitter or Facebook for the availability of the teleconference audio archive!

ANALYSIS: VOLCKER RULE TO CURB BANK TRADING PROVES HARD TO WRITE

Three years after first proposing that banks be prevented from making market bets with their own money, Paul Volcker's rule remains unfinished, the Wall Street Journal reported yesterday. The Volcker rule, a centerpiece of the sweeping overhaul of financial regulation known as Dodd-Frank, is an attempt to protect the financial system from risk. The rule looks to prohibit banks from making investment bets with their own money, but it has proved difficult to apply. Five years after cratering financial firms ignited a global crisis, and three years after Dodd-Frank outlined the Volcker rule as a central part of the government response, the rule languishes unfinished and unenforced, mired in policy tangles and infighting among five separate agencies whose job is to produce the fine print. Read more. (Subscription required.)

COMMENTARY: FIVE YEARS LATER, FINANCIAL LESSONS NOT LEARNED

Sunday marks the fifth anniversary of the fateful day that investment bank Lehman Brothers filed for bankruptcy, signaling the start of a frightening financial meltdown, but we are still missing some of the lessons drawn out by the crisis, according to a commentary in yesterday's Wall Street Journal by Prof. Alan Blinder of Princeton University. Years of disgraceful financial shenanigans in the 2000s, some illegal but many just immoral, brought on the Great Recession with virtually no help from any co-conspirators, according to Blinder. Congress and President Obama reacted comparatively weakly with the Dodd-Frank Act of 2010, which Blinder said certainly did not seek to remake the U.S. financial system. A supporter of Dodd-Frank, Blinder has found that the law now seems to be withering on the regulatory vine. Far from being tamed, the financial beast has gotten its mojo back, according to Blinder. Read the full commentary. (Subscription required.)

ANALYSIS: SEC TRIES TO REBUILD ITS REPUTATION

The Securities and Exchange Commission is ending its push to punish financial-crisis misconduct in the same way it started -- with a new chairman vowing that Wall Street's top cop will be tougher in the future, according to a Wall Street Journal analysis today. In 2009, at the depths of the recession, Mary Schapiro took the reins at the SEC, promising to "move aggressively to reinvigorate enforcement" at the agency. She created teams to target various types of alleged misconduct, including one focused on the complicated mortgage bonds that helped set off a global financial panic. The agency has filed civil charges against 138 firms and individuals for alleged misconduct just before or during the crisis, according to the analysis, and it received $2.7 billion in fines, repayment of ill-gotten gains and other penalties. But some of the SEC's highest-profile probes of top Wall Street executives have stalled and are being dropped. In April, former federal prosecutor Mary Jo White took the reins as SEC chairman with a simple enforcement motto: "You have to be tough." She tossed out the SEC enforcement policy that allowed almost all defendants to settle cases without admitting wrongdoing. In August, hedge-fund manager Philip Falcone became the first example of this new approach when he and his firm, Harbinger Capital Partners LLC, admitted to manipulating bond prices and improperly borrowing money from a fund. The policy shift comes as the SEC turns the page on its financial crisis work. New investigations into misconduct linked to the meltdown have slowed to a trickle, and a statute-of-limitations deadline is looming for many cases, which will generally restrict the sanctions that the SEC can enforce for misconduct that is more than five years old. Read more. (Subscription required.)

U.S. FORECLOSURE FILINGS DROP 34 PERCENT AS PROPERTY PRICES RISE

RealtyTrac issued a report showing that foreclosure filings fell 34 percent in the U.S. last month as first-time defaults dropped to the lowest level in almost eight years and rising home prices made it easier for distressed owners to sell, Bloomberg News reported today. Default, auction and repossession filings totaled 128,560 in August, with one in 1,019 U.S. households receiving a notice, the Irvine, Calif.-based data seller said today in a report. It was the 35th consecutive month in which total notices declined on an annual basis, with foreclosure starts plunging 44 percent, RealtyTrac said. Increasing buyer demand and climbing property values are helping some troubled borrowers refinance or sell rather than lose their homes to foreclosure. The S&P/Case-Shiller index of property values in 20 cities rose 12.1 percent in June from a year earlier. Last month, foreclosure starts totaled 55,775, the lowest level since December 2005, and fell on a year-over-year basis in 38 states, RealtyTrac said. Read more.

LATEST ABI PODCAST EXPLORES BANKRUPTCY'S CORPORATE TAX IMPLICATIONS

ABI Resident Scholar Prof. Kara Bruce speaks with Prof. Diane Lourdes Dick of Seattle University School of Law about how companies in chapter 11, such as Solyndra and WaMu, preserve valuable tax attributes through holding companies. Prof. Dick discusses her current research looking into how stakeholders of financially distressed firms exploit various loopholes in chapter 11 to transfer value outside of bankruptcy's distributional norms. Click here to listen to the podcast.

NEW ABILIVE WEBINAR OCT. 3: THE INTERSECTION OF INTELLECTUAL PROPERTY AND BANKRUPTCY: KODAK, NORTEL AND OTHER CASES

IP experts will shed light on the mysteries of understanding IP law and navigating the often puzzling sales processes, drawing from their experiences in Nortel, Kodak and other important cases, in an abiLIVE webinar on Oct. 3 from 1:00-2:15 p.m. ET. Speakers will include David Berten (Global IP Law Group, LLC; Chicago), Pauline K. Morgan (Young Conaway Stargatt & Taylor, LLP; Wilmington, Del.), Cassandra M. Porter (Lowenstein Sandler LLP; Roseland, N.J.), Kelly Beaudin Stapleton (Alvarez & Marsal; New York) and Christopher Burton Wick (Hahn Loeser & Parks LLP; Cleveland). To register, click here.

RECORDING AVAILABLE OF THE ABILIVE WEBINAR EXAMINING THE NEW U.S. TRUSTEE FEE GUIDELINES!

If you were not able to join ABI's recent well-attended abiLIVE webinar examining the U.S. Trustee Fee Guidelines for chapter 11 cases filed on or after Nov. 1, a recording of the program is now available for downloading! A panel of experts, including Clifford J. White, the director of the U.S. Trustee Program, discussed some of the ways the new guidelines could change day-to-day operations in firms, issues relating to the new market rate benchmarks, and how these changes might alter insolvency practice. The 90-minute recording is available for the special ABI member price of $75 and can be purchased here.

ABI GOLF TOUR UNDERWAY; LAST STOP FOR 2013 IS WINTER LEADERSHIP CONFERENCE IN DECEMBER

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.

ABI IN-DEPTH

NEW CASE SUMMARY ON VOLO: MORRIS AVIATION LLC V. DIAMOND AIRCRAFT INDUSTRIES INC. (6TH CIR.)

Summarized by Mike Debbeler of Graydon Head & Ritchey LLP

The Sixth Circuit ruled that the airplane manufacturer's opinion of the "quality and reliability" of components was not a fraudulent or negligent misrepresentation where the component manufacturer filed bankruptcy and voided warranties on components shortly after plaintiff purchased the airplane from the manufacturer. The airplane manufacturer's mere opinion as to component manufacturer's financial health did not form the basis of a misrepresentation claim.

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: HOW HAS THE FINANCIAL SECTOR CHANGED SINCE THE LEHMAN FILING?

The Bankruptcy Blog Exchange is a free ABI service that tracks more than 80 bankruptcy-related blogs. A recent blog post explores how the financial sector has changed since the Lehman Brothers chapter 11 filing on Sept. 15, 2008.

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

Success fees for financial advisors should be prohibited.

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.

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  CALENDAR OF EVENTS
 

2013

September
- Lawrence P. King and Charles Seligson Workshop on Bankruptcy & Business Reorganization
    Sept. 18-19, 2013 | New York
- abiLIVE Webinar: Complex Requirements and Ethical Duties of Representing Consumer Debtors
     Sept. 24, 2013
- Bankruptcy 2013: Views from the Bench
    Sept. 27, 2013 | Washington, D.C.

October
- abiLIVE Webinar: The Intersection of Intellectual Property and Bankruptcy: Kodak, Nortel and Other Cases
     Oct. 3, 2013
- Midwestern Bankruptcy Institute Program and Midwestern Consumer Forum
    Oct. 4, 2013 | Kansas City, Mo.
- Professional Development Program
    Oct. 11, 2013 | New York, N.Y.
- Chicago Consumer Bankruptcy Conference
    Oct. 14, 2013 | Chicago, Ill.
- International Insolvency & Restructuring Symposium
    Oct. 25, 2013 | Berlin, Germany


  


November
- Complex Financial Restructuring Program
   Nov. 7, 2013 | Philadelphia, Pa.
- Corporate Restructuring Competition
   Nov. 7-8, 2013 | Philadelphia, Pa.
- Austin Advanced Consumer Bankruptcy Practice Institute
   Nov. 10-12, 2013 | Austin, Texas
- Detroit Consumer Bankruptcy Conference
   Nov. 11, 2013 | Detroit, Mich.
- Delaware Views from the Bench
   Nov. 25, 2013 | Wilmington, Del.

December
- Winter Leadership Conference
    Dec. 5-7, 2013 | Rancho Palos Verdes, Calif.
- ABI/St. John’s Bankruptcy Mediation Training
    Dec. 8-12, 2013 | New York


 
 
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Senate Poised to End Filibuster on Nominees

ABI Bankruptcy Brief | July 11, 2013
 
  

July 11, 2013

 
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  NEWS AND ANALYSIS   

SENATE POISED TO END FILIBUSTER ON NOMINEES

Majority Leader Harry Reid announced today his intention to force a vote on Monday to change the Senate’s longstanding rule permitting extended debate on executive branch nominees. The rule change would permit the majority to approve nominations with a simple majority vote. This so-called “nuclear option” would be a profound change in a fundamental Senate rule. Most immediately, the rule change would allow the Senate’s Democratic Majority to confirm Richard Cordray as Director of the Consumer Financial Protection Bureau, along with two nominees to the NLRB. Cordray was renominated after his recess appointment by President Obama was cast into doubt by a D.C. Circuit decision holding that the NLRB Nominees were recess appointed (on the same day in January 2012) in an unconstitutional manner.

HOUSE HEARING EXAMINES IF DODD-FRANK ACT'S "ORDERLY LIQUIDATION AUTHORITY" IS UNCONSTITUTIONAL

Arguing that due process rights “are vaporized” under the Dodd-Frank Act (DFA), witnesses told the House Financial Services Subcommittee on Oversight and Investigations on Tuesday that aspects of the DFA might be unconstitutional, the National Law Journal reported yesterday. Members of the subcommittee focused on the law’s all new—and as yet untested—orderly liquidation authority. Intended as a third way between bankruptcy and bailout, the provision gives the Federal Deposit Insurance Corp. (in conjunction with other regulators) the ability to take over an institution whose failure might pose a risk to the financial stability of the United States. Columbia Law School professor Thomas Merrill testified that DFA raises serious constitutional issues—almost sure to lead to litigaion the first time the provision is invoked, with potentially disastrous consequences. “It’s very likely to cause the whole process to go off the rails and become chaotic,” he said. “My concern is that the constitutional issues will work against the purpose [of the provision]…at a time when it’s least appropriate to bring them to the fore.” But Pepper Hamilton partner Timothy McTaggart argued that the law likely would pass constitutional muster, pointing out that fewer than 170 laws enacted by Congress between 1789 and 2002 were held unconstitutional. “A difference in policy choice as reflected in enacted legislation does not make the legislation unconstitutional,” he said. To date, no court has held Dodd-Frank to be unconstitutional, but a case pending before the U.S. District Court for the District of Columbia, State National Bank of Big Spring v. Lew, may provide the first test. Former White House Counsel C. Boyden Gray is co-counsel in the case, brought by a Texas community bank, the Competitive Enterprise Institute, the 60 Plus Association and several states. He testified before the subcommittee that Dodd-Frank “violates the Constitution’s system of checks and balances” and gives “regulators effectively unlimited power.” Read more.

Click here to read the prepared witness testimony.

COMMENTARY: HOW TO AVOID THE NEXT MF GLOBAL SURPRISE

When MF Global went bankrupt in October 2011, thousands of its customers in the United States discovered that their overseas investments were not as safe or secure as they had assumed—and that they no longer had access to their funds, according to an editorial in yesterday's Wall Street Journal by MF Global Trustee James Giddens. The company faced extraordinary liquidity demands in its final, chaotic days, including margin calls on massive European sovereign-debt bets taken by CEO Jon Corzine and others. Desperate for funds, management improperly raided segregated customer money held by the company's broker-dealer in the U.S., resulting in a $900 million shortfall, according to Giddens. Once MF Global U.K. was put into liquidation, British administrators determined that under U.K. law virtually no money had been actually segregated for customers—which added an additional $700 million shortfall in customers' foreign accounts. Another problem in MF Global—and to some extent in Lehman Brothers—was the company's large, complicated legal structure. The trustee for the MF Global holding company had a different constituency of lenders and general creditors than Giddens did as trustee for the customers and creditors of the U.S. broker-dealer. Trustees with differing priorities led to confusion and further delay. Going forward, Giddens said that there is a need for clear and consistent cross-border rules regarding the protection of money in customer accounts. Clearer rules would pave the way for quicker and more efficient return of customer property when the next MF Global or Lehman occurs. Read more. (Subscription required.)

SENATORS NEAR DEAL ON STUDENT LOAN RATES

Senators are near a deal to provide a long-term fix to student loan rates, but that compromise will likely rest on a score from the Congressional Budget Office (CBO), as well as members' ability to sell the compromise to skeptical members in both parties, The Hill reported today. The potential agreement would look broadly similar to a competing proposal offered by a group of Republicans and Democrats and comes one day after Senate Democrats failed to muster enough support for a one-year freeze of lower interest rates. A bipartisan group of senators pushing a competing student loan proposal met with Senate Majority Whip Dick Durbin (D-Ill.) yesterday, as well as Sens. Tom Harkin (D-Iowa) and Jack Reed (D-R.I.). Harkin and Reed were strong proponents of the one-year freeze, which was broadly rejected by Republicans on the Senate floor on Tuesday. The senators pushing the competing proposal at the meeting were Sens. Joe Manchin (D-W.Va.), Angus King (I-Maine), Lamar Alexander (R-Tenn.) and Richard Burr (R-N.C.). Members at that meeting agreed on a framework of a bill and now are waiting for a CBO score to determine if the measure is close enough to deficit-neutral to assuage Democrats who had blasted the original proposal, which would have reduced the deficit by $1 billion. Read more.

COMMENTARY: GOOD AND BAD BANK CAPITAL

Three years after President Obama signed Dodd-Frank, U.S. financial regulators have taken their first significant step toward protecting taxpayers from giant bank failures, according to an editorial today in the Wall Street Journal. Under a proposal released on Tuesday from the Federal Deposit Insurance Corp., the eight largest U.S. financial houses would be required to hold more capital. Specifically, the FDIC and their regulatory colleagues at the Federal Reserve and Comptroller of the Currency proposed to increase the leverage ratio at giant bank holding companies to 5 percent from 3 percent, and to 6 percent for the insured deposit-taking banks inside these holding companies. The proposal is still a major step toward taxpayer protection, according to the editorial, and might require the giants to increase capital by close to $90 billion by 2018, or to shrink their balance sheets to operate more safely with the level of capital they hold today. Read more. (Subscription required.)

ANALYSIS: HOW STOCKTON’S BANKRUPTCY MAY CHANGE THE WAY WE ANALYZE MUNICIPAL CREDIT RISK

The bankruptcy of Stockton, Calif., and the forthcoming legal battle has the potential to permanently change the way municipal credit risk is viewed both in California and on a national level, according to a recent briefing paper prepared by Thornburg Investment Management. Bankruptcy Judge Christopher M. Klein on April 1 accepted the city of Stockton’s petition to proceed with chapter 9 bankruptcy. The interesting aspect of the Stockton case revolves around the treatment of pension obligations. Pensions are protected by California statute, to the detriment of bondholders. Because of this protection, public employees in Stockton and throughout California have traditionally been unwilling to make material concessions when negotiating with troubled municipalities. In fact, this issue is pervasive across the country. In general, public labor unions have seldom made material concessions because of a perceived protection of future benefits. Unfortunately for the public employees in Stockton and around the country, the bankruptcy case will be heard in federal court and the status of the pensions will play a key role. Should Judge Klein rule in favor of pension holders, protecting their benefits above the claims of bondholders, it would essentially subordinate bondholders to the claims of public workers. A ruling of that type would immediately decrease the credit quality of all municipal bonds. In the future, public employees would have no incentive to negotiate with stressed municipalities, knowing that their benefits are protected. The result could be an increase in chapter 9 filings as municipalities lose the flexibility to control future expenses. On the other hand, should Judge Klein rule that public employees must take a haircut in line with other creditors, municipal bondholders will benefit. Click here to read the full analysis.

COMMENTARY: TO CATCH A CREDITOR

Earlier this year the Federal Trade Commission completed a multiyear study of credit-report errors and found that nearly 20 percent of consumers had errors in at least one of their credit files, and that 13 percent saw an improvement in their scores when the errors were corrected, according to an op-ed in today' New York Times. A 2012 study by The Columbus Dispatch analyzed 30,000 complaints to the FTC; of those, 1,500 people reported that their files included someone else’s information. Nearly a third said that the credit agencies did not correct the errors, despite being asked to do so. Most egregious, almost 200 people said their reports showed them as deceased. While federal law requires credit bureaus to conduct a reasonable investigation of consumer complaints, the marketplace can penalize credit bureaus that investigate too aggressively, according to the op-ed. Credit bureaus are heavily dependent on lenders for both revenue and the information the bureaus package and sell; if a credit bureau presses a lender too hard, the lender could patronize a different bureau and withhold data about its customers. In contrast, consumers have little power over credit-reporting agencies. Consumers cannot, for example, block credit bureaus from obtaining information about their transactions. Read more.

ABILIVE WEBINAR NEXT WEEK TO 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.

NEW abiLIVE WEBINAR ON AUGUST 20: HOW WILL THE NEW U.S. TRUSTEE FEE GUIDELINES IMPACT YOU?

The new U.S. Trustee Fee Guidelines will affect all attorneys and firms who work on larger chapter 11 cases filed on or after November 1st. ABI's Ethics & Professional Compensation Committee will present a panel of experts, including Cliff White, the Director of the U.S. Trustee Program, to discuss some of the ways the new guidelines may change day-to-day operations in firms, issues relating to the new market rate benchmarks, and how these changes might alter insolvency practice. Register today to hear government, attorney and academic perspectives on this important and timely topic.

ABI GOLF TOUR UNDERWAY; NEXT STOP IS THE SOUTHEAST BANKRUPTCY CONFERENCE NEXT WEEK

The next stop for the ABI Golf Tour is the famed Golf Club of Amelia Island course on Amelia Island, Fla., in conjunction with the Southeast Bankruptcy Conference next week. Final scoring to win the Great American Cup—sponsored by Great American Group—is 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.

ABI IN-DEPTH

NORTON JUDICIAL EXCELLENCE AWARD NOMINATIONS OPEN

Nominations are now open for the 8th Annual Judge William L. Norton Judicial Excellence Award, to be presented during the ABI luncheon at the annual meeting of the National Conference of Bankruptcy Judges on Nov. 1, 2013. The award is presented by ABI and Thomson Reuters each year to the current or retired bankruptcy judge whose career embodies the same continued dedication and outstanding contributions to the insolvency community as the award’s namesake, Judge Norton. Nominations are considered by a committee made up of representatives from the Norton treatise and past ABI presidents. Nomination forms are available from Clay Mattson at Thomson Reuters ([email protected]) and should be submitted by July 29.

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: PERRY V. KEY AUTO RECOVERY (IN RE PERRY; 9TH CIR.)

Summarized by Hilda Montes de Oca of the U.S. Bankruptcy Court for the Central District of California

Affirming the bankruptcy court, the Ninth Circuit Bankruptcy Appellate Panel (BAP) held that the bankruptcy court did not abuse its discretion when it declined the debtor’s request for a hearing on his second motion for reconsideration and instead entered an order denying the second motion for reconsideration because the debtor did not set the second motion for reconsideration for hearing as required under the Local Bankruptcy Rules for the Central District of California. The BAP also held that the bankruptcy court did not abuse its discretion when it declined to consider the “new evidence” presented by the debtor in support of his second motion for reconsideration because the debtor could have submitted the “new evidence” from 2004 earlier to the bankruptcy court.

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: CORKER-WARNER BILL: A GREAT STARTING POINT IN THE GSE REFORM DEBATE

The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A recent blog post discusses how the Corker-Warner legislation may be a bridge between the advocates of a purely private market and those who favor some role for the federal government in housing.

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

When will the dowward trend of consumer bankruptcy filings turn around?

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 37 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.

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  CALENDAR OF EVENTS
 

2013

July
- Northeast Bankruptcy Conference and Northeast Consumer Forum
     July 11-14, 2013 | Newport, R.I.
- abiLIVE Webinar: § 1111(b) Election, Plan Feasibility and Cramdown Issues
     July 15, 2013
- Southeast Bankruptcy Workshop
     July 18-21, 2013 | Amelia Island, Fla.

August
- Mid-Atlantic Bankruptcy Workshop
    August 8-10, 2013 | Hershey, Pa.
- abiLIVE Webinar: How Will the New U.S. Trustee Fee Guidelines Impact You?
     August 20, 2013
- Southwest Bankruptcy Conference
    August 22-24, 2013 | Incline Village, Nev.

September
- ABI Endowment Golf & Tennis Outing
    Sept. 10, 2013 | Maplewood, N.J.
- ABI Endowment Baseball Game
    Sept. 12, 2013 | Baltimore, Md.
- Lawrence P. King and Charles Seligson Workshop on Bankruptcy & Business Reorganization
    Sept. 18-19, 2013 | New York
- abiLIVE Webinar: Complex Requirements and Ethical Duties of Representing Consumer Debtors
     Sept. 24, 2013
- Bankruptcy 2013: Views from the Bench
    Sept. 27, 2013 | Washington, D.C.


  


October
- Midwestern Bankruptcy Institute Program and Midwestern Consumer Forum
    Oct. 4, 2013 | Kansas City, Mo.
- ABI Endowment Football Game
    Oct. 6, 2013 | Miami, Fla.
- Professional Development Program
    Oct. 11, 2013 | New York, N.Y.
- Chicago Consumer Bankruptcy Conference
    Oct. 14, 2013 | Chicago, Ill.

November
- Austin Advanced Consumer Bankruptcy Practice Institute
   Nov. 10-12, 2013 | Austin, Texas
- Detroit Consumer Bankruptcy Conference
   Nov. 11, 2013 | Detroit, Mich.

December
- ABI/St. John’s Bankruptcy Mediation Training
    Dec. 8-12, 2013 | New York


 
 
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ABIs Chapter 11 Commission Eyes Updates to Bankruptcy Code

ABI Bankruptcy Brief | January 17 2013
 
  

January 17, 2013

 
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  NEWS AND ANALYSIS   

ABI'S CHAPTER 11 COMMISSION EYES UPDATES TO BANKRUPTCY CODE

With the Bankruptcy Code now 35 years old, 2013 looks to be a key year in developing a replacement as ABI's Chapter 11 Commission continues its study of chapter 11 with a "top to bottom look" at the Code, The Deal reported yesterday. No specific changes have been recommended to date, and the Commission will not be close to specifics until it gets reports from all 13 of its advisory committees, according to Commission Co-Chair Al Togut of Togut, Segal & Segal LLP (New York). The commission, which is just looking at corporate chapter 11 and the parts of the code that affect business bankruptcies, expects to complete its report in the spring of 2014, said fellow Co-Chair Bob Keach of Bernstein Shur (Portland, Maine), adding that by the end of 2013 the commission should have a good idea of what the report will look like. The report will have two components: ideas for change where there is a consensus and proposals that lack a consensus. Since the ABI does not lobby Congress for legislation, an organization or a combination of organizations will likely work to convert the report into legislation, said Keach. "The idea is to develop a statute for the next 40 years that will get us through as well as this one did," Keach says. Read more.

PENSION FUNDING GAP WIDENS FOR BIG CITIES

A study released on Tuesday by the the Pew Center on the States found that major U.S. cities emerged from the financial crisis with increasingly underfunded pension and retiree health care plans, the Wall Street Journal reported today. Cities employing nearly half of U.S. municipal workers saw their pension and retiree health care funding levels fall from 79 percent in fiscal year 2007 to 74 percent in fiscal year 2009, according to the latest available data, the Pew report stated. The growing funding gulf, which the study estimated at more than $217 billion for the 61 cities in the study, raises worries about local finances at a time when states are also struggling to recover from the recession. More than half, or some $118 billion, of the projected pension shortfall stems from unfunded retiree health care costs, according to the Pew report. Read more. (Subscription required.)

ABI will be holding a media teleconference on Tuesday, Jan. 22, at 11 a.m. ET with experts examining municipal distress in 2013. There are limited spots available to ABI members that would like to join the call next week. Contact John Hartgen, ABI's Public Affairs Manager, at [email protected] if you would like to participate in the teleconference.

CFPB'S NEW MORTGAGE RULES AID HOMEOWNERS

U.S. banks will have to do more to help struggling mortgage borrowers keep their homes under final rules released today by the Consumer Financial Protection Bureau (CFPB), the Wall Street Journal reported today. Mortgage-loan servicers, which collect borrowers' loan payments, will have to evaluate troubled borrowers for all loan-assistance options permitted by mortgage investors such as Fannie Mae and Freddie Mac, as well as private investors, according to the CFPB rules that will take effect in a year. Currently, no national standard exists for how mortgage servicers must treat defaulting borrowers. The lending industry "must consider all options available from the mortgage owners or investors to help the borrower retain the home," said CFPB director Richard Cordray. The industry "can no longer steer borrowers to those options that are most financially favorable for the servicer." The agency's move follows numerous federal and state efforts to regulate the industry, which came under fire after reports in 2010 found that banks were foreclosing on borrowers without properly reviewing documents and other paperwork, a practice dubbed "robo-signing." In 2011, regulators found abuses of foreclosure processes at 14 lenders. Ten of those lenders agreed to an $8.5 billion settlement of regulators' allegations. Read more. (Subscription required.)

ANALYSIS: "ODD COUPLE" IN U.S. HOUSE TO TACKLE MORTGAGE FINANCE

The will of the new Congress to begin rebuilding the U.S. mortgage finance system rests largely in the hands of Reps. Jeb Hensarling (R-Texas) and Maxine Waters (D-Calif.), known to be partisan fighters from opposite ends of the ideological spectrum, Bloomberg News reported yesterday. Hensarling is the new chairman of the House Financial Services Committee, while Waters is the highest-ranking Democrat. "While we clearly have profound philosophical differences – some might call us Capitol Hill’s newest odd couple – we are exploring areas of common concern where we hopefully can work together," Hensarling said. In addition to grappling with proposals to tweak and amend the Dodd-Frank regulatory law, they will be seeking common ground on what may be the panel's biggest issue this year: The future of Fannie Mae and Freddie Mac. For Hensarling, the solution is to abolish the government-owned mortgage companies and completely privatize the mortgage market. Waters argues that some government involvement is needed to preserve the 30-year fixed home loan. It is likely that the two lawmakers eventually will support a plan that would shrink the role of Fannie Mae and Freddie Mac without threatening to choke off the flow of money into home loans. Read more.

FLORIDA DEFIES HOUSING REBOUND AS FORECLOSURES SOAR

More than six years after subprime lending and overbuilding led to the recent U.S. real estate slump, RealtyTrac Inc. reported that Florida had the biggest increase in home seizures last year, and the highest foreclosure rate, Bloomberg News reported today. One in every 32 Florida households received a notice of default, auction or repossession in 2012, more than double the average U.S. rate of one in every 72, according to RealtyTrac Inc.'s report. Home repossessions increased by 16,276 during the year to 84,456, the biggest gain nationwide. Adding to the state’s woes is a backlog of foreclosures caused by a required court review of each case. Judicial supervision of repossessions is slowing Florida’s rebound, in contrast to California and Arizona, so-called nonjudicial states, where lenders send notices to delinquent borrowers and record defaults at the county level without court intervention, said Lawrence Yun, chief economist of the National Association of Realtors. It took 853 days on average in Florida to complete a foreclosure in the fourth quarter, the third-longest behind New York and New Jersey, RealtyTrac said in today’s report. The U.S. average rose to 414 days from 348 days a year earlier, the most since the data firm began tracking the metric in 2007. Texas had the shortest period at 113 days. Almost 20 percent of outstanding Florida loans were more than 30 days delinquent or in foreclosure in November, the largest share of non-current mortgages in the nation, according to data provider Lender Processing Services. Read more.

ANALYSIS: REWRITING U.S. TAX LAW HAS CONSENSUS WHILE FIX PROVES ELUSIVE

Maintaining a bipartisan consensus in Congress to rewrite the U.S. tax code will be difficult as there is little agreement on what a tax overhaul means and what it is supposed to achieve, according to a Bloomberg News analysis yesterday. Republicans, who control the U.S. House, want lower tax rates and fewer breaks in a simpler system that raises no additional revenue. The Obama administration and many Democrats endorse some of those goals – particularly corporate rate reduction – while viewing a tax rewrite as a way to guarantee more revenue from top earners. That split will challenge lawmakers as they decide whether to rewrite the code as part of budget talks or work on a major tax bill without a fiscal agreement. Compromise remains elusive, though the code is more convoluted -- and therefore, ripe for change -- following passage of a law Jan. 1 that raised marginal rates and reinstated limits on personal exemptions and deductions. Read more.

BLOOMBERG'S LATEST "BILL ON BANKRUPTCY" VIDEO: MF GLOBAL CREDITORS UNDETERRED BY LOW VALUE

The low valuation creditors of MF Global Holding Ltd. put on their liquidating chapter 11 plan is not deterring the bond market where debt is being sold for roughly twice the predicted recovery for unsecured creditors of the liquidating commodity broker's holding company. Bloomberg Law's Lee Pacchia and Bloomberg News bankruptcy columnist Bill Rochelle explore this and other current cases in their latest video. Click here to view.

TAKE AN IN-DEPTH LOOK AT CREDITORS' COMMITTEES AND THE ROLE OF THE INDENTURE TRUSTEES AT ABI'S 31ST ANNUAL SPRING MEETING

The 2013 Annual Spring Meeting, to be held April 18-21, 2013, at the Gaylord National Resort and Convention Center in National Harbor, Md., features a roster of the best national speakers, while the depth and scope of topics offer something for everyone. Specifically, four concurrent workshops will cover various “tracks,” including programs for attorneys in commercial cases, a track for restructuring professionals, a track of professional development programming and a track dealing solely with consumer issues. More than 16 hours of CLE/CPE is offered in some states, along with ethics credit totaling 3 hours, making the cost only about $50 per credit. In addition, committee sessions will drill down on other topics to provide you with the most practical and varied CLE/CPE experience ever. Sessions include:

• 17th Annual Great Debates
• Mediation: An Irrational Approach to a Rational Result
• Current Issues for Financial Advisors in Bankruptcy Cases
• The Individual Conundrum: Chapter 7, 11 or 13?
• The Power to Veto Bankruptcy Sales
• Real Estate Issues in Health Care Restructurings
• Law Firm Bankruptcies
• How to Be a Successful Expert
• The Ethical Compass: Multiple Ethical Schemes Applicable to Financial Advisors
• Chapter 9s, Nonprofits and Other Nontraditional Restructuring Processes
• And much more!

The Spring Meeting will also feature a field hearing of the ABI Commission to Study the Reform of Chapter 11, a report from the ABI Ethics Task Force, a luncheon panel discussion moderated by Bill Rochelle of Bloomberg News, and a Final Night Gala Dinner featuring a concert by Joan Jett and the Blackhearts!

Register today!

ABI IN-DEPTH

ABI LIVE WEBINAR: REVISITING RADLAX AND HALL – NEW LEGAL AND PRACTICAL IMPACT OF THE DECISIONS

See why this was the top-rated panel at the ABI Winter Leadership Conference last month! Join the expert panel on Feb. 19 from 12:00-1:15pm EST as the summarize and discuss the legal impact and practical implications of the Supreme Court’s 2012 decisions in Radlax and Hall. Participants include:

Susan M. Freeman of Lewis and Roca LLP (Phoenix)

Adam A. Lewis of Morrison & Foerster LLP (San Francisco)

• Prof. Charles J. Tabb of the University of Illinois College of Law (Champaign, Ill.)

Eric E. Walker of Perkins Coie LLP (Chicago)

Click here to register!

LATEST CASE SUMMARY ON VOLO: TIMCO LLC V. T AND M SALES AGENCY INC. (IN RE TIMCO LLC; 6TH CIR.)

Summarized by James E. Bailey III of Butler Snow O'Mara Stevens & Cannada PLLC

The Sixth Circuit ruled that the appeal of the bankruptcy court's decision to remand a case removed by state court action to confirm an arbitration award that was affirmed by a district court was not reviewable by the court of appeals under 28 U.S.C. § 1334(d). The appeal of the order granting relief from the automatic stay to allow the state court action to proceed was moot where the debtor failed to obtain stay pending appeal and the state court had entered a valid order confirming an arbitration award.

There are more than 700 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: HIGH-INCOME EARNERS NOT BARRED FROM PASSING BANKRUPTCY'S MEANS TEST

The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A new post discusses the misconception that bankruptcy's means test bars high-income earners from qualifying for chapter 7 relief.

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'S INDUBITABLE EQUIVALENTS: TELL US A TUNE AND WE'LL SING YOU THAT SONG!

ABI's Indubitable Equivalents need your help: Tell us your favorite Rock and Roll tune - that elusive classic that takes you back, makes your feet tap, your head bang, and your horns come out! If we pick your song, you get widespread promotion by the band and you'll receive a free CD of IE’s greatest hits!

To enter, log onto www.abiband.com or “like” the Band’s Facebook page.

The fine print: No purchase necessary. You can enter as many times as you want. Multiple winners will be selected. Winners will be announced on the IE website and on Facebook. Entry deadline: January 31.

ABI Quick Poll

After Stern, bankruptcy courts do not have the constitutional authority to enter final judgments on fraudulent conveyance claims.

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 37 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.

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MONDAY:

 

 

WCBC 2013
Jan. 21, 2013
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NEXT THURSDAY:

 

 

ACBPIKC 2013
Jan. 24-25, 2013
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COMING UP:

 

 

ACBPIKC 2013
Feb. 7-9, 2013
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ABI Live Webinar: Revisiting RadLAX and Hall- New Legal and Practical Impact of the Decisions
Feb. 19, 2013
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ACBPIKC 2013
Feb. 20-22, 2013
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Paskay 2013
March 7-9, 2013
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BBW 2013
March 22, 2013
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ASM 2013
April 18-21, 2013
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  CALENDAR OF EVENTS
 

2013

January
- Western Consumer Bankruptcy Conference
     January 21, 2013 | Las Vegas, Nev.
- Rocky Mountain Bankruptcy Conference
     January 24-25, 2013 | Denver, Colo.

February
- Caribbean Insolvency Symposium
     February 7-9, 2013 | Miami, Fla.
- ABI Live Webinar: Revisiting RadLAX and Hall- New Legal and Practical Impact of the Decisions
     February 19, 2013


  

- VALCON 2013
     February 20-22, 2013 | Las Vegas, Nev.

March
- 37th Annual Alexander L. Paskay Seminar on Bankruptcy Law and Practice
     March 7-9, 2013 | St. Petersburg, Fla.
- Bankruptcy Battleground West
     March 22, 2013 | Los Angeles, Calif.

April
- Annual Spring Meeting
     April 18-21, 2013 | National Harbor, Md.


 
 
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May Bankruptcy Filings Fall 11 Percent from 2011 Commercial Filings Drop 21 Percent

ABI Bankruptcy Brief | June 5, 2012
 
  
June 5, 2012
 
home  |  chart of the day  |  blogs  |  bankruptcy code and rules  |  statistics  |  legislative news  |  volo
  NEWS AND ANALYSIS   

MAY BANKRUPTCY FILINGS FALL 11 PERCENT FROM 2011, COMMERCIAL FILINGS DROP 21 PERCENT

Total bankruptcy filings in the United States for May 2012 decreased 11 percent compared to the previous year, according to data provided by Epiq Systems, Inc. May bankruptcy filings totaled 109,392, down from the 122,836 filings registered in May 2011. Total commercial filings for May 2012 were 5,259, representing a 21 percent decrease from the 6,631 filings during the same period in 2011. The 104,133 total noncommercial filings for May represented a 10 percent drop from the May 2011 noncommercial filing total of 116,205. “Households have reduced their spending and businesses are benefiting from sustained low interest rates,” said ABI Executive Director Samuel J. Gerdano. “Expect a continued drop in bankruptcy filing rates as families and businesses reinforce their balance sheets and cut costs.” Total commercial chapter 11 filings also decreased in May. Overall, the May total commercial chapter 11 filing total of 682 represented a 6 percent decrease from May 2011’s total of 722, but a 3 percent increase over the April 2012 total of 660. Click here to read the press release.

ANALYSIS: PRIVATE STUDENT LOAN RATES NEARLY EQUAL RATES OF CREDIT CARDS

Unlike the federal student-loan program, which lets consumers borrow at fixed rates directly from the government, private loans from at least 30 banks and other private lenders feature mostly variable rates that can be more than twice what some people pay in the U.S. program, according to a Bloomberg News analysis yesterday. Some private student loans carry rates as high as 10.25 percent. Loans from banks and other private lenders make up about 15 percent of the $1 trillion in outstanding student debt, according to an estimate by Mark Kantrowitz, who runs FinAid.org, a website about college grants and loans. About 2.9 million students have private loans, according to the most recent federal data analyzed by The Institute for College Access and Success, an Oakland, Calif.-based nonprofit group. Private-lending practices are drawing the government’s attention as Congress and the Obama administration look to help students avoid predatory, high-interest loans. "Like mortgages before the financial crisis, many borrowers took on private student-loan debt with terms and conditions they didn’t fully understand," said Rohit Chopra, the student-loan ombudsman at the Consumer Financial Protection Bureau, a federal agency studying the private-loan market. Recent graduates "are now fighting to stay afloat because these loans don’t always have the same repayment options as federal student loans," he said. Read more.

For more on student debt, be sure to listen to ABI’s latest podcast featuring scholars examining issues related to student loans and bankruptcy.

ROMNEY VOWS QUICK EXIT FROM GM STAKE

Republican Presidential candidate Mitt Romney believes President Barack Obama is holding on to the government's stake in General Motors to avoid an embarrassing financial loss before the election, and says he would sell the stock quickly if he wins the White House, the Detroit News reported today. As part of the government's GM bailout, the U.S. Treasury still holds a 26 percent stake in the Detroit automaker, and has been sitting on that share for 35 months. At GM's closing price yesterday of $21.11 a share, the government would lose $16 billion on its $49.5 billion bailout. Last month, Tim Massad, the assistant Treasury secretary who oversees the GM stake, said that the government has no timetable for selling its GM stock. Read more.

FINRA CALLS FOR MORE CONFLICT-OF-INTEREST CURBS FOR ANALYSTS AND INVESTMENT BANKERS

A Wall Street regulator is pushing to extend conflict-of-interest curbs to include analysts and investment bankers who work in the giant market for debt offerings, the Wall Street Journal reported today. Such controls already exist for Wall Street firms dealing with stocks, but the Financial Industry Regulatory Authority (FINRA) plans to submit by year-end proposed rules for debt. The rules could force firms to build firewalls between investment bankers who pitch debt offerings and research analysts who follow companies issuing the debt. The rules would require Securities and Exchange Commission approval. Read more. (Subscription required.)

FREDDIE MAC ANNOUNCES LOWER MODIFICATION INTEREST RATE

Freddie Mac announced on Friday that starting July 1, the GSE's Standard Modification interest rate will come down from 5 percent to 4.625 percent, DSNews.com reported yesterday. The Standard Modification is for borrowers who do not qualify for the government’s Home Affordable Modification Program (HAMP). The modification makes payments more affordable by lowering a borrower’s principal and interest payments by at least 10 percent. The modification includes a trial period, as does HAMP, to ensure that borrowers can maintain modified mortgage payments. The Freddie Mac Standard Modification is part of the Servicing Alignment Initiative, which is an effort to create consistency in how delinquent GSE loans are serviced. Read more.

ABI PODCAST FEATURES SCHOLARS EXAMINING STUDENT DEBT AND BANKRUPTCY

The latest ABI podcast features Profs. Daniel Austin of Northeastern University School of Law and G. Marcus Cole of Stanford Law School talking with ABI Resident Scholar David Epstein about current issues surrounding educational debt and bankruptcy. Click here to access the podcast

TOMORROW! WEBINAR TO EXAMINE HOW TO HANDLE AN ADMINISTRATIVELY INSOLVENT ESTATE

Panelists from one of the top-rated sessions at the 2011 Winter Leadership Conference are going to reconvene for an ABI and West LegalEd Center webinar on June 6 titled, "Handling the Administratively Insolvent Estate: What to Do When Your Chapter 11 Goes South." (Note the change of date: This program will now take place on June 6 rather than the previous date of June 5.) CLE credit will be available for the webinar, which will last from 11 a.m. - 12:30 p.m. ET.

Speakers include:

Robert J. Feinstein of Pachulski Stang Ziehl & Jones LLP (New York)
Cathy Rae Hershcopf of Cooley LLP (New York)
Robert L. LeHane of Kelley Drye & Warren LLP (New York)

Robert J. Keach of Bernstein Shur (Portland, Maine) will be the moderator for the webinar.

The webinar costs $115, and purchase provides online access for 180 days. If you are purchasing a live webcast, you will receive complimentary access to the on-demand version for 180 days once it becomes available. Click here for more information.

ABI IN-DEPTH

WEBINAR ON JUNE 26 TO EXAMINE SUPREME COURT'S RULING IN RADLAX CASE

Having already examined the oral argument in a previous ABI media teleconference, panelists will reconvene for an ABI and West LegalEd Center webinar on June 26 to discuss last week's Supreme Court ruling in RadLAX Gateway Hotel LLC v. Amalgamated Bank. CLE credit will be available for the webinar, which will be held from 2:00-3:30 p.m. ET.

Experts on the program include:

David Neff of Perkins Coie LLP (Chicago), the counsel of record for petitioner RadLAX Gateway Hotel LLC and participant in the argument.
Jason S. Brookner of Andrews Kurth LLP (New York), whose article was cited in the brief for the respondent.
• Prof. Charles Tabb, the Alice Curtis Campbell Professor of Law at the University of Illinois College of Law, who recently published a paper titled "Credit Bidding, Security, and the Obsolescence of Chapter 11."

ABI Resident Scholar David Epstein will be the moderator for the webinar.

The webinar costs $115 and purchase provides online access for 180 days. If you are purchasing a live webcast, you will receive complimentary access to the on-demand version for 180 days once it becomes available. Click here for more information.

LATEST CASE SUMMARY ON VOLO: WHITE V. COMMERCIAL BANK AND TRUST CO. (IN RE WHITE; 8TH CIR.)

Summarized by Tony Bisconti of Bienert, Miller & Katzman

Reversing the bankruptcy court's order denying the debtors' motion to avoid Commercial Bank's judicial lien, the Eighth Circuit BAP held that because both debtors' property would be exempt under Arkansas law in the absence of Commercial Bank's judicial lien, the lien was avoidable, and the fact that at the time the judicial lien became fixed the debtors held title to the subject property by tenancy by the entirety, but subsequently created a tenancy in common, did not change the fact that the lien was avoidable. The BAP also held that the appeal of the bankruptcy court's order granting Commercial Bank relief from the automatic stay was moot.

More than 500 appellate opinions are summarized on Volo typically 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: MORE ON THE SIGNING OF THE TEMPORARY BANKRUPTCY JUDGESHIP EXTENSION ACT

The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A new post features further details on the "Temporary Bankruptcy Judgeship Extension Act of 2011," (Pub. L. No. 112-121) which was signed by the President on May 25.

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
First-day orders authorizing full and immediate payment of the claims of ‘critical vendors’ should be prohibited; all pre-petition unsecured creditors should be subjected to the same rules. 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 37 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.

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TOMORROW!

 

ABI'S "Handling the Administratively Insolvent Estate- What to Do When Your Chapter 11 Goes South" Webinar
June 6, 2012
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COMING UP

 

CS 2012
June 7-10, 2012
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NE 2012
July 12-15, 2012
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SE 2012
July 25-28, 2012
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ABI'S Webinar to Discuss the Supreme Court's Forthcoming Ruling in RadLAX Gateway Hotel LLC v. Amalgamated Bank
June 26, 2012
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MA 2012
August 2-4, 2012
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SW 2012
Sept. 13-15, 2012
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SE 2012
Sept. 13-14, 2012
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SE 2012
Oct. 5, 2012
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SE 2012
Oct. 5, 2012
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SE 2012
Oct. 8, 2012
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  CALENDAR OF EVENTS

June
- ABI's "Handling the Administratively Insolvent Estate- What to Do When Your Chapter 11 Goes South" Webinar
     June 6, 2012
- Central States Bankruptcy Workshop
     June 7-10, 2012 | Traverse City, Mich.
- ABI Webinar Examining the Supreme Court's Ruling in the RadLAX Case
     June 26, 2012

July
- Northeast Bankruptcy Conference and Northeast Consumer Forum
     July 12-15, 2012 | Bretton Woods, N.H.
- Southeast Bankruptcy Workshop
     July 25-28, 2012 | Amelia Island, Fla.

  

 

August
- Mid-Atlantic Bankruptcy Workshop
     August 2-4, 2012 | Cambridge, Md.

September
- Southwest Bankruptcy Conference
     September 13-15, 2012 | Las Vegas, Nev.
- Complex Financial Restructuring Program
     September 13-14, 2012 | Las Vegas, Nev.

October
- Midwestern Bankruptcy Institute Program, Midwestern Consumer Forum
     October 5, 2012 | Kansas City, Mo.
- Bankruptcy 2012: Views from the Bench
     October 5, 2012 | Washington, D.C.
- Chicago Consumer Bankruptcy Conference
     October 8, 2012 | Chicago, Ill.

 
 
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