Case Updates

For decades, it has been commonplace for non-franchise businesses using a quasi-franchise business model (i.e., any business format license) to distinguish themselves from franchisors in order to avoid the arduous California franchise laws. A recent California district court case suggests that this may be changing – at least when confronted with employee misclassification claims. In Ambrose v. Avis Rent a Car Sys. (Ambrose v. Avis Rent a Car Sys., 2014 U.S. Dist. LEXIS 170406 (C.D. Cal. Dec. 8, 2014)), the defendants –… Read more

FHA Handbook: Last week, the Federal Housing Administration issued an updated handbook consolidating its guidance for lenders into a single resource. The updated resource is distinct from FHA’s effort to update its servicing manual. Comments on servicing changes are due Oct. 17. See updated handbook HMDA Data: In addition, Home Mortgage Disclosure Act data for 2013 is now available at http://www.consumerfinance.gov/hmda/. HMDA data is collected from financial institutions and includes statistics on applications, originations, denials, and loan purchases and sales, and breaks… Read more

Dear constituency list members of the Insolvency Law Committee, The following is a case update analyzing a recent decision of interest: SUMMARY The United States Bankruptcy Appellate Panel of the Ninth Circuit (the “BAP”) has affirmed a bankruptcy court’s ruling that individual debtor’s chapter 11 post-petition earnings which are property of the estate under § 1115 revert to him or her upon a subsequent conversion to chapter 7.  Wu v. Markosian (In re Markosian) – 9th Cir. BAP (3/12/14).  Click HERE http://cdn.ca9.uscourts.gov/datastore/bap/2014/03/12/Markosian-13-1339.pdfto read… Read more

Dear constituency list members of the Insolvency Law Committee, the following is a recent case update:    SUMMARY On June 12, 2014, in Clark v. Rameker, the United States Supreme Court unanimously held that funds held in inherited IRAs are not “retirement funds” within the meaning of 11 U.S.C. §522(b)(3)(C) and are therefore not exempt property.  To read the full decision, click here:  http://www.supremecourt.gov/opinions/13pdf/13-299_6k4c.pdf FACTS In 2001, Heidi Heffron-Clark inherited an individual retirement account (“IRA”) worth roughly $450,000 from her mother’s estate.  Heffron-Clark… Read more

On July 14, 2014, the Consumer Financial Protection Bureau (CFPB) filed a lawsuit in federal district court against law firm Frederick J. Hanna and Associates and three of its partners. The action alleges that the firm, which filed more than 350,000 debt collection lawsuits in Georgia alone between the years 2009 and 2013, violated the Fair Debt Collection Practices Act (FDCPA) as well as the Dodd-Frank Wall Street Reform and Consumer Protection Act by operating “less like a law firm… Read more

The complaint was recently unsealed in a Qui tam action, where plaintiff and Texas resident Michael Fisher brought a $1 Billion dollar whistleblower action against Wells Fargo Bank N.A. under the False Claims Act. The complaint was filed in the United States District Court for the Southern District of New York. From 2008-2012, Fisher worked for law firms assisting with loan modifications relating to residential property mortgage loans made by Wells Fargo and other servicers or lenders. In 2009, the… Read more

Dear constituency list members of the Insolvency Law Committee, the following is a case update analyzing a recent case of interest: SUMMARY On June 11, 2014, in Heller Ehrman LLP v. Davis, Wright, Tremaine, LLP, the United States District Court for the Northern District of California ruled that the trustee of the bankruptcy estate of the defunct law firm Heller Ehrman LLP (“Heller”) could not recover fees earned by other law firms on Heller matters that former Heller shareholders took with… Read more

Dear constituency list members of the Insolvency Law Committee, the following is a case update analyzing a recent case of interest: SUMMARY On June 9, 2014, in Executive Benefits Ins. Agency v. Arkison, the United States Supreme Court ruled that, pursuant to 28 U.S.C. § 157(c)(1), a bankruptcy court may make proposed findings of fact and conclusions of law in a Stern “core” proceeding subject to de novo review by an Article III court.    To read the full decision, click here: http://www.supremecourt.gov/opinions/13pdf/13-339_886a.pdf.  FACTS The Palavedas owned two companies… Read more

On May 14, 2014, the Office of Mortgage Settlement Oversight released its Compliance in Progress report summarizing the six compliance reports filed with the United States District Court for the District of Columbia. These reports are required by the February 9, 2012 national mortgage settlement reached between the attorneys general of 49 states and the District of Columbia (every state except Oklahoma), the federal government and five banks and mortgage servicers – Ally/GMAC, Bank of America, Citibank, J.P. Morgan Chase… Read more

Dear constituency list members of the Insolvency Law Committee, the following is a case update on a recent decision of interest: SUMMARY The Supreme Court of the United States held that a bankruptcy court exceeded the limits of its authority by imposing a surcharge on a debtor’s homestead exemption to pay for a chapter 7 trustee’s litigation fees and costs incurred in avoiding a fraudulent lien against estate property created by the debtor.  In a unanimous opinion written by Justice… Read more