Business Law Insolvency Law Committee

The debtor’s principal – also a potential target of the chapter 7 trustee’s avoiding powers action - lost his bid to stop a sale of the debtor’s remaining assets and the avoiding power action against him. Read more

In Censo, LLC v. New Rez, LLC, 2022 WL 1055936 (No. NV-21-1125-LTF) (9th Cir. BAP April 5, 2022)(“Censo”), the United States Bankruptcy Appellate Panel for the Ninth Circuit (the “BAP”) ruled that the post-petition entry of a judgment against the plaintiff debtor on a defendant’s counterclaims in a District Court quiet title claim action initiated by the debtor against the defendant did not violate the automatic stay. Read more

In yet another circuit court ruling on Article III standing to assert consumer claims under a federal statute, here the Fair Credit Reporting Act (FCRA), the Eighth Circuit Court of Appeals (the Court) denied standing to a prospective employee who was denied employment when a criminal background check showed an undisclosed felony on her record. Read more

The Bankruptcy Appellate Panel for the Sixth Circuit (the BAP) recently held that the “shared-responsibility payment” (SRP) assessed under the Affordable Care Act (ACA) for failure to purchase health insurance was a “tax” measured by income for priority purposes in a bankruptcy proceeding. In re Juntoff, 636 B.R. 868 (6th Cir. BAP March 21, 2022). Read more

Joining the litany of recent cases which address standing in Fair Debt Collection Practices Act (FDCPA) actions, the Seventh Circuit Court of Appeals (the Court) ruled that a consumer who received a dunning letter from a debt collector seeking to collect time-barred debt did not experience sufficient concrete injury to have Article III standing to assert the federal claims. Pierre v Midland Credit Management, Inc., 2022 WL 986441 (7th Cir. April 1, 2022). Read more

It was not an April Fool’s joke when on April 1, 2021, the Ninth Circuit Bankruptcy Appellate Panel (“BAP”) affirmed the decision of the Oregon bankruptcy court denying the discharge of debtor Peter Szanto (“Szanto”) under Bankruptcy Code sections 727(a)(2)(B), (4)(A), (4)(D), and (6)(A). Read more

The Seventh Circuit Court of Appeals (the Court) recently ruled that an asset purchaser who knew of but ignored a third party’s right of first refusal was not a good-faith purchaser protected by §§ 363(f) and (m) of the Bankruptcy Code. Archer-Daniels-Midland Company v. Country Visions Cooperative, 2022 WL 998984 (7th Cir. April 4, 2022). Read more

In Thakkar v. Good Gateway, LLC, 2022 WL 552743 (Nos. 20-4792 and 20-4800) (N.D. Ga. January 12, 2022) (“Thakkar”), the United States District Court for the Northern District of Georgia (the “Court”) rule that because he did not have a direct pecuniary interest in the matter, an LLC member of the debtors lacked standing to appeal the Bankruptcy Court’s ruling denying the debtors’ motions against a creditor for sanctions for allegedly violating the automatic stay and a mediation order in their bankruptcy cases. Read more

The 9th Circuit Court of Appeals held that a bankruptcy court’s order denying a motion for relief from the automatic stay “without prejudice” conclusively resolved the requested relief and therefore was an appealable final order under 28 U.S.C. section 158(a). See In re Mayer (9th Cir. 2022) 2022 WL 679085. Read more

On June 21, 2022, President Joseph Biden signed S.3823 into law. The law, which is effective immediately, makes the following material changes to the Bankruptcy Code. Read more