Business Law Insolvency Law Committee

The Bankruptcy Appellate Panel of the 9th Circuit upheld the order of Eastern District Bankruptcy Judge Rene Lastreto, II, which granted a summary judgment of non- dischargeability based on a stipulated Judgment over the objection of the Debtor, who argued the stipulation did not contain sufficient stipulated facts to establish issue preclusion. Read more

The Fifth Circuit Court of Appeals (the Court), in a case arising from the failure to perform by the successful online bidder at a bankruptcy auction, reversed the district court’s admission of online documents which provided a monetary limit for the bidder’s liability. Deciding evidentiary issues which had not been adequately addressed by precedent in the circuit, the Court found the documents had not been properly authenticated and were not excepted from the hearsay rul Read more

In an unpublished disposition, the Ninth Circuit Court of Appeals (the Court) affirmed bankruptcy court and district court rulings that a debtor’s beneficial interest in real property owned by an irrevocable trust was a sufficient equitable interest to support an automatic homestead exemption under California law. Read more

Two recent opinions, one from the 11th Circuit in the case of Jackson v. Le Ctr. On Fourth, LLC (In re Le Ctr. On Fourth, LLC) 2021 U.S. App. LEXIS 33845 (11th Cir. 2021), and the second from the Eastern District of Virginia in the case of Patterson v. Mahwah Bergen Retail Grp. Inc. (2022 U.S. Dist. LEXIS 7431) (E.D. Va 2022), express opposite views of Chapter 11 third-party releases. Read more

The Bankruptcy Appellate Panel for the Ninth Circuit (“BAP”) affirmed the decision of the bankruptcy court for the Central District of California that entered a default judgment revoking the Debtor’s discharge after the Court had struck the Debtor’s answer as a terminating sanction. Read more

The Bankruptcy Court for the District of Puerto Rico (the “Court”) recently denied a creditor’s motion requesting the redesignation of a Subchapter V filing to a single asset real estate case and upheld the creditor’s 1111(b)(2) election. Read more

In Sienega v. California Franchise Tax Board (In re Sienega), 18 F.4th 1164 (9th Cir. 2021), the U.S. Court of Appeals for the Ninth Circuit (the “Court”) held that faxes sent by a debtor to the California Franchise Tax Board (the “FTB”), notifying the FTB of adjustments to the debtor’s federal tax liability, did not constitute “returns” within the meaning of section 523(a) of the Bankruptcy Code. Read more

In Citigroup, Inc. v. Bruce (In re Bruce), 2021 WL 6111925 (No. 21-CV-7455 (CV)) (S.D.N.Y. December 27, 2021) (“Bruce”), finding that there was no controlling authority in the Supreme Court or the Second Circuit, the United States District Court for the Southern District of New York (the “Court”) granted the appellant banks’ motion to certify for direct appeal to the Second Circuit Court of Appeals (the “Circuit Court”) the Bankruptcy Court’s order denying the banks’ motion to dismiss the debtor’s complaint asserting a nationwide class action against the banks seeking damages and contempt for violation of a discharge order and injunction. Read more

The debtor, Family Friendly Contracting LLC (the “Debtor”), filed a voluntary bankruptcy petition under Subchapter V of Chapter 11 of the Bankruptcy Code. Read more

The Ninth Circuit Bankruptcy Appellate Panel (the BAP) recently ruled that state laws which provide for attorney’s fee awards are applicable in bankruptcy litigation only if they are connected to the substance of the claims and are not dependent on misconduct or improper purpose of parties or attorneys. Read more