Finance and Banking

U.S. CONSUMER SPENDING FALLS IN JUNE; INCOMES RISE

Consumer spending in the U.S. fell slightly in June and marked the second straight decline even though wages rose sharply, according to the latest government data, MarketWatch.com reported. Spending fell less than 0.1 percent last month on a seasonally adjusted basis, the Commerce Department said today, and spending for May was revised down slightly to a 0.1 percent decrease. Personal income, meanwhile, jumped 0.5 percent in June. Since incomes rose faster than spending, the personal savings rate rose to 4.4 percent from 4.0 percent. Read more.

REPORT: COMPLETED U.S. FORECLOSURES HOLD STEADY IN JUNE

CoreLogic reported today that the amount of completed U.S. home foreclosures held steady in June compared to the month before, although the level was down from a year ago, according to Reuters. There were 60,000 finished foreclosures in June, the same as in May and down from the 80,000 seen in June 2011, CoreLogic said. Since the financial crisis erupted in September 2008, there have been about 3.7 million foreclosures. About 1.4 million homes, or 3.4 percent of homes with a mortgages, were in some stage of the foreclosure process. That was down from 1.5 million homes, or 3.5 percent, a year ago and unchanged from May. The five states with the highest number of foreclosures in the last 12 months were California, Florida, Michigan, Texas and Georgia. Those states alone accounted for 48.4 percent of all completed foreclosures. Read more.

ANALYSIS: CALIFORNIA LURING MOST MUNICIPAL FUND INVESTMENT SINCE 2007, DEFIES BANKRUPTCY WAVE

California municipal funds are garnering the most demand since 2007, helping fuel the biggest rally in the state's debt since May and allaying concerns that bankruptcies might curb the appetite of individual investors, Bloomberg News reported yesterday. With local yields close to their lowest rates since the 1960s, investors seeking tax-free income are willing to take the added risk of debt from Standard & Poor's lowest-rated U.S. state. Bond funds focusing on California issuers have added assets for 18 straight weeks, the longest streak since 2007, according to Lipper US Fund Flows data. The funds increased even as three municipalities in the past six weeks from the most-populous state decided to file for bankruptcy protection, including San Bernardino and Stockton, a city east of San Francisco that is trying to set a precedent by imposing losses on bondholders. Read more.

MUNI RATES EXAMINED FOR SIGNS OF RIGGING

Attention has swung to a set of benchmark interest rates that help determine how much cities and states pay to borrow money in the bond market, the New York Times reported today. The scrutiny of the Municipal Market Data (or M.M.D.) index comes on the heels of revelations that a broader financial industry benchmark, the London Interbank Offered Rate (Libor), was manipulated by banks before and after the financial crisis. Libor is used to help determine the costs of products like mortgages and credit cards. Thomson Reuters, which owns Municipal Market Data, said yesterday that it "has been involved in discussions with regulators" about the rates, which influence the prices of bonds and derivatives in the $3 trillion municipal bond market. The M.M.D. rates influence a much smaller market than Libor, but it is one that is crucial to how cities and states across America borrow money to maintain roads and bridges and provide essential services such as public education. The scrutiny of the M.M.D. rates comes as a number of other events are drawing attention to the transparency and fairness of the municipal bond market. Three former bankers at UBS yesterday went on trial in Manhattan on charges that they had colluded to steer municipal bond transactions to specific banks in exchange for kickbacks. Separately, the Securities and Exchange Commission will release a lengthy report soon that recommends reforms for the municipal bond market so that investors are put on more even footing. Read more.

ANALYSIS: THOUGH SPLITTING UP WAS CONSIDERED, BANK OF AMERICA EXECUTIVES VOTED AGAINST THE IDEA

Long before Sanford Weill suggested last week that big banks should split up, Bank of America Corp. executives and directors considered the idea and then decided against it, the Wall Street Journal reported yesterday. While the Charlotte, N.C.-based company's exploration of a possible breakup in 2010 and 2011 came and went, it illustrates the powerful and contradictory forces buffeting giant financial companies even as the financial crisis recedes. Stung by public revulsion to the bailouts of 2008, regulators are pushing rules that would tax the biggest firms based on size. Big-bank share prices have tumbled, and even some bankers who spent their careers assembling sprawling conglomerates are questioning whether combining traditional lending with trading and deal-making makes sense. At Bank of America, Chief Executive Brian Moynihan and his team looked at a possible bankruptcy of Countrywide Financial Corp., the troubled mortgage operation it purchased in 2008. Management also studied whether it made sense to break off Merrill Lynch, the securities firm it purchased in 2009. Moynihan ultimately recommended to his board that neither action made sense. The company decided that Merrill had become too big of a profit center and that splitting it off could expose the brokerage firm to the sort of funding problems that killed off other Wall Street firms in 2008. Meanwhile, it felt that a bankruptcy of Countrywide might invite more legal and reputational troubles for Bank of America while exposing other subsidiaries to problems. Read more. (Subscription required.)

ABI IN-DEPTH

LATEST CASE SUMMARY ON VOLO: IN RE PHILADELPHIA NEWSPAPERS LLC (3D CIR.)

Summarized by Suzanne Iazzetta of Becker Meisel LLC

The Third Circuit ruled that when deciding whether an appeal is equitably moot, a court must consider all five factors set forth in In re Continental Airlines, 91 F.3d 553, 560 (3d Cir. 1996). In particular, a court must consider whether allowing the appeal to go forward would undermine the plan, an analysis that the court must undertake even if the plan has already been "substantially consummated."

Additionally, under applicable Pennsylvania law, the debtor’s post-petition publication of an article that included hyperlinks to a previously published allegedly defamatory article was not a "republication" such that it could be deemed a separate act of defamation. Therefore, the tort claimant did not sustain its burden to show its entitlement to a § 503(b)(9) administrative expense claim based on the debtor's post-petition publication.

More than 570 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: HOW LONG UNTIL RESCAP LIQUIDATES?

The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A recent post examines the $109 million loss by Rescap in the first 45 days of its chapter 11 case and ponders whether there will be a liquidation in the case.

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
The Twombly/Iqbal rule for pleading ‘plausible’ claims has been applied too stringently in dismissing avoidance actions for failure to state a claim.

Click here to vote on this week's Quick Poll. Click here to view the results of previous Quick Polls.

IS YOUR ABI MEMBERSHIP PROFILE CURRENT?

Keeping a current profile will allow you to benefit from one of ABI's most important services - networking. When you update your profile, you are putting your most valuable information in the membership directory. Be sure to include your areas of expertise, firm information, education and join any other committees that are of interest. Click here to update your profile.

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

September
- Complex Financial Restructuring Program
     September 13-14, 2012 | Las Vegas, Nev.
- Southwest Bankruptcy Conference
     September 13-15, 2012 | Las Vegas, Nev.
- 38th Annual Lawrence P. King and Charles Seligson Workshop on Bankruptcy & Business Reorganization
     September 19-20, 2012 | New York, N.Y.

October
- Nuts & Bolts for Young and New Practitioners - KC
     October 4, 2012 | Kansas City, Mo.
- 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.
- International Insolvency and Restructuring Symposium
     October 18, 2012 | Rome, Italy

November
- U.S./Mexico Restructuring Symposium
     November 7, 2012 | Mexico City, Mexico
- Detroit Consumer Bankruptcy Conference
     November 12, 2012 | Detroit, Mich.

U.S. MORTGAGE, CREDIT CARD DELINQUENCY RATES DECLINE

TransUnion Corp. reported today that the delinquency rates for mortgages and credit cards declined during the second quarter, and the firm predicts mortgage-delinquency rates will maintain their downward trajectory for the remainder of 2012, according to Dow Jones Newswires. The national mortgage delinquency rate--or the rate of borrowers at least 60 days past due--dropped for the second consecutive quarter, to 5.49 percent from the 5.78 percent mortgage delinquency rate in the first quarter. Between the first and second quarters of 2012, all but five states experienced decreases in their mortgage-delinquency rates, and 76 percent of metropolitan areas saw improvement in their mortgage-delinquency rates during the second quarter. Meanwhile, the national credit card delinquency rate--or the ratio of borrowers at least 90 days past due--dropped to 0.63 percent in the second quarter from 0.73 percent in the previous quarter. The credit card delinquency rate is at its lowest level since reaching 0.6 percent a year earlier. Read more.

COMMENTARY: THE GOVERNMENT SHOULD LOOK TO MASS MORTGAGE REFINANCING

With principal writedown no longer an option, the government needs to find a new way to facilitate mass mortgage refinancings, according to a commentary in today's New York Times by Prof. Joseph E. Stiglitz of Columbia University and Mark Zandi of Moody's Analytics. Refinancing at the current low rates would allow homeowners to significantly reduce their monthly payments, and a mass refinancing program would work like a potent tax cut. Refinancing would also significantly reduce the chance of default for underwater homeowners, according to the commentary. With fewer losses from past loans burdening their balance sheets, lenders could make more new loans, and communities plagued by mass foreclosures might see relief from blight. Read the full commentary.

DURBIN SEES VISA ACCORD THWARTING PUSH TO CAP CREDIT CARD FEES

Senator Richard Durbin (D-Ill.)'s office told retailers that their efforts to have Congress rein in credit card swipe fees would be imperiled if they support a $6.6 billion antitrust settlement with Visa Inc. and MasterCard Inc., Bloomberg News reported yesterday. "This is going to foreclose the prospect of good legislation for the foreseeable future," Dan Swanson, senior judiciary counsel for Durbin, said in a conference call with the Food Marketing Institute. Durbin, the Senate Majority Whip, won the inclusion of limits on debit-card swipe fees, or interchange, in the 2010 Dodd-Frank Act. That trimmed annual revenue for the biggest U.S. banks by about $8 billion and benefited retailers including Wal-Mart Stores Inc. and Target Corp. Credit-card swipe fees are higher and generate about $40 billion a year for lenders such as JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc. The Food Marketing Institute, a trade group whose members include Target, Sears Holdings Corp. and Wal-Mart, does not have a position on the settlement. Visa, MasterCard and banks agreed last month to resolve the seven-year-old case, one of the largest class actions in history. The deal, which requires the approval of U.S. District Judge John Gleeson in Brooklyn, N.Y., may be nullified if enough merchants refuse to join the proposed class action. Read more.

MUNICIPAL BOND RULE MIRED IN LEGISLATIVE LIMBO

A provision of the Dodd-Frank Act that would require municipal bond advisers to put the interests of taxpayers first has been bogged down in a rule-making quagmire in Washington, D.C., the New York Times reported today. As part of the wide-ranging regulatory changes that followed the financial crisis of 2008, the Dodd-Frank Act included a provision that would make municipal advisers "fiduciaries," meaning they must put local residents’ interests ahead of their own. Making advisers fiduciaries would be “the first time in the history of the securities laws that issuers of the securities have been protected,” said Robert W. Doty, president of AGFS, a consulting firm in Sacramento. He is a registered municipal adviser and favors the fiduciary mandate. But before that provision can take effect, the law calls for the Securities and Exchange Commission to define "municipal adviser." The SEC proposed a definition 20 months ago, but it was swiftly beaten back by the banking, brokerage and engineering industries, among others. Opponents argued that the SEC was overreaching and that they were already regulated and should not be given a new mandate. Additionally, Rep. Robert J. Dold (R-Ill.) introduced a bill last year that would eliminate the measure. Read more.

ANALYSIS: HARD TIMES SPREAD FOR CITIES

Fiscal woes that have caused high-profile bankruptcies in California are surfacing across the country as municipalities struggle with uneven growth and escalating health and pension costs following the worst recession since the 1930s, the Wall Street Journal reported today. Budget crunches already have prompted Michigan lawmakers to authorize emergency fiscal managers, and led the mayor of Scranton, Pa., to temporarily cut the pay of all city workers to the minimum wage. In a majority of the nation's 19,000 municipalities—urban and rural, big and small—stagnant property tax revenues, diminish aid from states and rising costs are forcing less dramatic but still difficult steps. Moody's Investors Service recently said that while municipal bankruptcies are likely to remain rare, it warned of a "a small but growing trend in fiscally troubled cities unwilling to pay their debt obligations." Read more. (Subscription required.)

ABI MEMBERS WELCOME TO ATTEND ACB'S FREE HALF-DAY "BANKRUPTCY: BACK TO THE FUTURE" PROGRAM IN SEPTEMBER

The American College of Bankruptcy invites you to attend a free half-day program on Sept. 28 in Chicago for a discussion of many of the challenging topics facing current bankruptcy and reorganization professionals. Topics to be addressed include recent decisions of the U.S. Supreme Court and Court of Appeals, important work of the Advisory Committee on Bankruptcy Rules, and developments in the field of bankruptcy ethics. The nation’s leading judges, academics and bankruptcy professionals are among the speakers for the program. While there is no cost to attend, seating is limited, so early reservation is suggested. For more information and to register, please click here.

ABI IN-DEPTH

LATEST CASE SUMMARY ON VOLO: FIRST PREMIER CAPITAL LLC V. REPUBLIC BANK OF CHICAGO (IN RE EQUIPMENT ACQUISITION RESOURCES; 7TH CIR.)

Summarized by Allen Guon of Shaw Gussis Fishman Glantz Wolfson & Towbin LLC

Seventh Circuit Court of Appeals affirmed the district court's ruling, which affirmed the bankruptcy court's ruling, that the granting of the settlement motion was not an abuse of discretion.

There are 600 appellate opinions 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: FIFTH CIRCUIT HOLDS STATE AGENCY PROCEEDINGS EXEMPT FROM AUTOMATIC STAY

The Bankruptcy Blog Exchange is a free ABI service that tracks 35 bankruptcy-related blogs. A recent post examines the Fifth Circuit’s ruling on June 18 in Halo Wireless, Inc. v. Alenco Communications, Inc., et al., affirming a bankruptcy court order that various state public utility commission proceedings initiated against Halo could proceed despite Halo’s subsequent chapter 11 bankruptcy.

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
The Twombly/Iqbal rule for pleading ‘plausible’ claims has been applied too stringently in dismissing avoidance actions for failure to state a claim.

Click here to vote on this week's Quick Poll. Click here to view the results of previous Quick Polls.

HAVE YOU TUNED IN TO BLOOMBERG LAW'S VIDEO PODCASTS?

Bloomberg Law's video podcasts feature top experts speaking about current bankruptcy topics. The podcasts are available via Bloomberg Law's YouTube channel so that you can access the programs from your computer or device of your choice! Click here to view the Bloomberg Law video podcasts.

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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September
- 7th Annual Golf and Tennis Outing
     September 11, 2012 | Maplewood, N.J.
- Complex Financial Restructuring Program
     September 13-14, 2012 | Las Vegas, Nev.
- Southwest Bankruptcy Conference
     September 13-15, 2012 | Las Vegas, Nev.
- 38th Annual Lawrence P. King and Charles Seligson Workshop on Bankruptcy & Business Reorganization
     September 19-20, 2012 | New York, N.Y.
- American College of Bankruptcy's "Bankruptcy: Back to the Future" Program
     September 28, 2012 | Chicago, Ill.

October
- Nuts & Bolts for Young and New Practitioners - KC
     October 4, 2012 | Kansas City, Mo.
- 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.
- "Trending Issues: Examiners and Select Plan Confirmation Issues" Webinar
     October 15, 2012
- International Insolvency and Restructuring Symposium
     October 18, 2012 | Rome, Italy

November
- U.S./Mexico Restructuring Symposium
     November 7, 2012 | Mexico City, Mexico
- Professional Development Program
     November 9, 2012 | New York, N.Y.
- Detroit Consumer Bankruptcy Conference
     November 12, 2012 | Detroit, Mich.

COMMENTARY: IS DETROIT’S BANKRUPTCY A BID TO BUST UNIONS?

While Detroit’s bankruptcy has often been portrayed as “a cautionary tale about what can happen when a once great American city is run into the ground by poor leadership and pensions run amok,” Paul Alexander, a former Time reporter who now blogs for the Huffington Post suggests in a commentary that it is “yet another battle between Republicans and public employee unions.” Alexander bases his analysis on the close political ties between Michigan Gov. Rick Snyder and conservative donors, including the DeVos family and the Koch brothers, who strongly supported the state’s right-to-work legislation pushed through by Snyder last December. That effort prompted AFL-CIO president Richard Trumka to label Gov. Snyder a "puppet of extreme donors" whose actions "will diminish the voice of every working man and woman in Michigan." According to Alexander, critics contend Snyder believes that police, fire, and city retirees are “unsecured creditors, like bondholders, under U.S. bankruptcy law and aren't exempt from potential cuts.” Those 20,000 retired workers are owed $3.5 billion in pensions and $5.7 billion in health coverage, a significant portion of Detroit’s estimated $18 billion debt. Should they be forced, through bankruptcy, to surrender up to 90 percent of that money, as some union leaders estimate, it would represent, “a devastating blow to organized labor not just in Detroit but across the state and country,” according to Alexander. On September 19, Bankruptcy Judge Steven Rhodes, who is overseeing Detroit’s chapter 9 case, heard 45 of 109 individuals who filed papers to be allowed to speak to the court and explain why the bankruptcy should not be allowed to proceed. After listening to the testimony, which Judge Rhodes characterized as “extraordinary,” he was so moved, Alexander writes, that “he ordered Orr and Governor Snyder, who were not present in court, to listen to a recording of the hearing. ‘I think,’ Rhodes said from the bench, ‘democracy demands nothing less than they personally listen to what the citizens of this city said in this court today.’ ” Click here to read the full commentary.

GAO TO DECIDE QUESTION OF “TOO BIG TO FAIL”

Big banks argue that government subsidies, such as those that limited the meltdown of large financial institutions during fall of 2008 and early 2009, have been curtailed or even eliminated by the Dodd-Frank financial reform act passed in 2010. Now, according to Simon Johnson, writing on the New York Times Economix blog, a forthcoming assessment by the General Accounting Office will pass official judgment on the question. But Johnson suggests that the GAO would do well to look past the opinions of such insider banking groups as the Clearing House Association, and more toward independent researchers; both groups were represented at a conference on “too big to fail” banks last week at New York University. Johnson cites one of the independent papers, which concluded that “large institutions could borrow more cheaply from private lenders, presumably because the implicit government guarantee lowered the credit risk for those firms relative to their smaller competitors. They also find that ‘passage of Dodd-Frank did not eliminate expectations of government support’ — meaning this advantage in credit markets persists in the data.” Another paper found that, “at the peak of the crisis, the risk that the financial sector would collapse as a whole was substantially underpriced relative to the risk of failure of individual financial firms. This may sound technical but it is actually quite profound; it means the markets expected a rescue of some form at the systemwide level.” Johnson concedes that the GAO report could still support the banks’ contention that government subsidies have been eliminated, but includes a cautionary note in the form of an Upton Sinclair quotation: “It is difficult to get a man to understand something when his salary depends upon his not understanding it.” Read more.

PETTERS FALLOUT ENGULFS TWO POWERHOUSE LAW FIRMS

Bankruptcy Judge Paul G. Hyman, Jr. (S.D.Fl.) has green-lighted a massive Ponzi scheme lawsuit against one of the biggest law firms in the United States, Fulbright & Jaworski, according to an article in yesterday’s South Florida Business Journal. The ruling opens the way for a $718 million malpractice suit by Palm Beach Finance, which claims that Fulbright failed to advise them to file for bankruptcy following the explosion of the Tom Petters Ponzi scheme. The judge may also block Fulbright from recovering the fees it tried to charge Palm Beach Finance, which was heavily tied to Petters’ business. After Petters’ fraud was exposed in October 2008, Palm Beach delayed filing for bankruptcy for more than a year, at which time it had amassed debts of $1 billion. According to the South Florida Business Journal, two Miami powerhouse bankruptcy firms are involved. Michael Budwick of Meland Russin & Budwick represents the fund receiver Barry Mukamal; Scott Baena of Bilzin Sumberg represents Fulbright. Petters, meanwhile, is serving 50 years in prison for running the third-largest Ponzi scheme in the nation. Read more. (Subscription required.)

GOVERNMENT SHUTDOWN DELAYS MEDICAL SUPPLIER’S BANKRUPTCY EXIT

As Congress and the White House fitfully discuss ways to avert the country’s debt crisis and end the stalemate that has shuttered the government for more than a week, the shutdown has been blamed for the disruption of a California bankruptcy case. Lawyers for the Centers for Medicare and Medicaid Services persuaded Bankruptcy Judge Mark Wallace on Monday to delay a court hearing that could have allowed a California medical supplier, American Medical Technologies, to get out of chapter 11 protection. In papers filed with the U.S. Bankruptcy Court in Santa Ana, Calif., U.S. Department of Justice attorney Seth Shapiro said that CMS employees, furloughed by the government shutdown, are prohibited from working, and thus can’t evaluate AMT’s plan to repay the $76 million that the agency says it’s owed. “It’s not [AMT’s] fault if the government can’t keep its house in order,” said Scotta McFarland, AMT’s attorney, during Monday’s hearing after pointing out that Justice Department attorneys have the power to ask for special permission to keep working on cases. Judge Wallace, who reset the company’s bankruptcy-exit hearing to Nov. 20 from Oct. 21, hinted that he wouldn’t clear the company to leave chapter 11 unless its biggest debts are worked out in a repayment plan. Under AMT’s restructuring plan, the company’s founder and president, Gerald Del Signore, agreed to contribute several million dollars to help the company pay off its debts. Medicare payments make up more than 90 percent of AMT’s revenue. The company filed for chapter 11 protection in February 2012 amid a dispute with a Medicare-payment contractor, which halted payments to AMT during an investigation into whether the company improperly billed for extra wound care supplies. Click here to read the full article. Read more.

NEW FISCAL SURVEY FINDS NATION’S CITIES STRUGGLING, BUT SURVIVING

Pressure from soaring health care and pension costs, coupled with cuts in state and federal aid, are undermining the improving but still shaky financial health of the nation’s cities, according to a report released today, the Washington Post reported. The National League of Cities, which advocates on behalf of 1,700 member cities, said that its annual survey of local finance officers reflects a slowly brightening financial picture for many cities. Still, the survey found that cities continue to suffer the effects of the recent economic downturn, as well as structural problems, that are making it difficult for them to pay for core services such as public safety. The survey found that after six straight years of decline, cities this year reported a small increase in general fund revenues — the locally generated taxes, fees and outside aid that local officials have wide discretion to spend on services from public safety to parks. Sales and income tax revenues are up, but property taxes continue to decline because they typically reflect property values as much as several years before their collections. For cities, that means that their tax revenues are still depressed by the steep drop in property values that accompanied the downturn. Despite the problems, the report finds that few cities are facing the extreme pressure that since 2011 has caused Jefferson County, Ala., Stockton and San Bernardino, Calif., and Detroit to topple into bankruptcy. Overall, nearly three in four of the 350 city finance officers surveyed reported that their cities are better able to meet financial needs in 2013 than they were in 2012. But many also reported that they have been forced to squeeze jobs out of the budget, reduce health care and pension benefits and raise fees, and sometimes taxes, to make ends meet. Read more.

ABI LAUNCHES SIXTH ANNUAL WRITING COMPETITION FOR LAW STUDENTS

Law school students are invited to submit a paper between now and March 4, 2014 for ABI's Sixth Annual Bankruptcy Law Student Writing Competition. ABI will extend a complimentary one-year membership to all students who participate in this year's competition. Eligible submissions should focus on current issues regarding bankruptcy jurisdiction, bankruptcy litigation, or evidence issues in bankruptcy cases or proceedings. The first-place winner, sponsored by Invotex Group, Inc., will receive a cash prize of $2,000 and publication of his or her paper in the ABI Journal. The second-place winner, sponsored by Jenner & Block LLP, will receive a cash prize of $1,250 and publication of his or her paper in an ABI committee newsletter. The third-place winner, sponsored by Thompson & Knight LLP, will receive a cash prize of $750 plus publication of his or her paper in an ABI committee newsletter. For competition participation and submission guidelines, please visit http://papers.abi.org.

FIRST ABIWORKSHOP PROGRAM LOOKS AT RISKY TIMES FOR SECURED LENDERS AND SERVICERS! ATTEND IN PERSON OR VIA LIVE WEBSTREAM

You will not want to miss the abiWorkshops series' inaugural program, "Risky Times for Secured Lenders and Servicers." The program is cosponsored by TMA (Chesapeake), IWIRC (D.C./Greater Maryland) and RMA (Potomac), and will be held on Nov. 6 from 9 a.m. to 3 p.m. ET in the ABI Headquarters Conference Center in Alexandria, Va. The abiWorkshops series provides attendees two great ways of participating: You can register to attend in person at the ABI Conference Center, or you can participate via a live webstream! Topics that will be covered on the Nov. 6 program include:

- Living with the New CFPB Mortgage Servicing Rules
- Business Lending: Navigating What Lies Ahead
- Business Lending: Recent Legal Developments

For more information or to register for the "Risky Times for Secured Lenders and Servicers" abiWorkshop on Nov. 6, please click here.

EXPERTS TO EXAMINE STUDENT LENDING AND BANKRUPTCY AT ABI WORKSHOP PROGRAM ON NOV. 15

Experts will tackle the hot topic of student lending issues in bankruptcy on the abiWorkshops series' new program, "You Can't Discharge Student Loans in Bankruptcy - Or Can You?" The program will be held on Nov. 15 from 9 a.m. to 3 p.m. ET in the ABI Headquarters Conference Center in Alexandria, Va. The abiWorkshops series provides attendees two great ways of participating: You can register to attend in person at the ABI Conference Center, or you can participate via a live webstream! Topics that will be covered on the Nov. 15 program include:

- Student Lending Today: Who Borrows, How Much, Delinquency & Default Trends
- Repayment Options: Income Based Repayment and New Lender/Servicer Programs
- Litigation under Sect. 523(a)(8): What Proofs Are Needed? Evidence Demonstration

For more information or to register for the "You Can't Discharge Student Loans in Bankruptcy - Or Can You?" abiWorkshop on Nov. 15, please click 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: ONYEABOR V. CENTENNIAL POINT OWNERS ASSOCIATION (IN RE ONYEABOR) (10TH CIR.)

Summarized by Steven T. Mulligan of Bieging Shapiro & Barber LLP

he circuit court ruled that conversion is appropriate where a plan makes no provision for repayment of pre-petition secured claims, where the debtor’s income is insufficient to support her plan or even the appellees’ judgment lien, and where the debtor fails to address the trustee’s objections.

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: FIFTH CIRCUIT NIXES CONSENT IN STERN CASES

The Bankruptcy Blog Exchange is a free ABI service that tracks more than 80 bankruptcy-related blogs. A recent blog post argues that while the CFTC is on hiatus during the shutdown, the industry should consider the damage that might be done to a market that has become an integral part of banking.

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

Does the bankruptcy court's Section 105 power enable it to surcharge the debtor's exempt property?

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.

Have a Twitter, Facebook or LinkedIn Account?

Join our networks to expand yours.

2013

October
- 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
- abiWorkshop: "Risky Times for Secured Lenders and Servicers"
   Nov. 6, 2013 | Alexandria, Va.
- 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.

-abiWorkshop: "You Can't Discharge Student Loans in Bankruptcy - Or Can You?"
   Nov. 15, 2013 | Alexandria, Va.
- 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

January
- Western Consumer Bankruptcy Conference
    Jan. 20, 2014 | Las Vegas, Nev.
- Rocky Mountain Bankruptcy Conference
    Jan. 23-24, 2014 | Denver, Colo.