Here’s more in the continuing "Year in Review" series, delivering more of my backlog of twitter posts of case developments in the past 12 months. RSS Feeds are also available of my Twitter post, which later are collected here. My 1,500 previous twitter posts of case developments are here.
The inset photo is of the Federal Courthouse for the Bankruptcy Court for the Northern District of Alabama, Eastern Division, in Anniston, Alabama, where Judge James E. Robinson presides.
- B-NC: Tsfee isnt good faith tsfee if it has knowledge of facts that would put a reasonably prudent person on inquiry. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/SCHOFIELD-BK-MD-NC-WALDREP-9-22-11.pdf …
- SDNY D-Cts & BK-Cts seem split on whether-and if so to what extent-§546(e) insulates Madoff ponzi pmts. Cases here: http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/KeyMadoff546Cases-SDNY-2010-11.pdf …
- B-SDNY: Picard’s common law non-fraud claims ag insiders for failure to supervise, etc, not preempted by NY Martin Act. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PicardvsMadoffs-BK-SDNY-Lifland-9-22-11.pdf …
- B-SDNY: Wagoner & in pari delicto rules dont apply to insiders so Picard has standing sue them for common law fraud. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PicardvsMadoffs-BK-SDNY-Lifland-9-22-11.pdf …
- B-SDNY: Failure to provide modicum of specificity re §550 subseq. transfers to put Dfdts on notice warrants dismissal. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PicardvsMadoffs-BK-SDNY-Lifland-9-22-11.pdf …
- B-SDNY: §546(e) inapplicable to settlement pmts to Madoff insiders as against 546(e) purposes & incompatible w/ SIPA. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PicardvsMadoffs-BK-SDNY-Lifland-9-22-11.pdf …
- B-SDNY: Constructive fr tsf claims need not satisfy heightened pleading standards of FRCP 9(b) under BK Code or NYDCL. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PicardvsMadoffs-BK-SDNY-Lifland-9-22-11.pdf …
- B-SDNY: Ttee suffic. pled applic. of discovery rule to maintain actual fr. tsf. case for pmts occurring > 6 yrs pre-BK. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/BERNARD-BK-SD-NY-LIFLAND-9-22-11.pdf …
- B-SDNY: The "Ponzi scheme presumption" establishes the dbtrs’ fraudulent intent as required under the BK Code & NYDCL. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PicardvsMadoffs-BK-SDNY-Lifland-9-22-11.pdf …
- B-SDNY: DCT-Wood-8-31-11 op "instructive & pertinent" re relev. factors in FRCP 12(b) motion to dismiss a Madoff cplt. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PicardvsMadoffs-BK-SDNY-Lifland-9-22-11.pdf …
- B-AL: §327(e) special counsel only must show no conflict re specific matter that’s subject of retention http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/VISTA-BK-SD-AL-MAHONEY-5-29-12.pdf …
- B-AL: §327(e) does not insert any requirement of materiality regarding previous representation http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/VISTA-BK-SD-AL-MAHONEY-5-29-12.pdf …
- 9-BAP examines rts of cr. to w/draw proof of claim before/after adv. filing or plan acceptance/rejection. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/YUCCA-BK-NINIITH-CIRCUIT-PAPPAS-6-8-12.pdf …
- B-AL: Special retention per §327(e) must be unrelated to dbtr’s gen. reorg. & explicitly described http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/VISTA-BK-SD-AL-MAHONEY-5-29-12.pdf …
- 9-BAP: §1112(b)(4) is often invoked by bankruptcy courts when a chapter 11 debtor’s assets are swiftly being reduced http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/SERRON-BK-NINTH-CIRCUIT-PAPPAS-6-8-12.pdf …
- 9-BAP: Appellate tribunal only reviews issues argued specifically and distinctly-not summarily-in party’s opening brief http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/SERRON-BK-NINTH-CIRCUIT-PAPPAS-6-8-12.pdf …
- 9-BAP reviews numerous types of documents & pleadings deemed adequate per 9th to constitute an informal proof of claim http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/YUCCA-BK-NINIITH-CIRCUIT-PAPPAS-6-8-12.pdf …
- 9-BAP: Whether a valid informal proof of claim exists in a bankruptcy case is a question of law reviewed de novo http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/YUCCA-BK-NINIITH-CIRCUIT-PAPPAS-6-8-12.pdf …
- 9-BAP reverses, holding complaint in an adversary proceeding constituted an informal proof of claim. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/YUCCA-BK-NINIITH-CIRCUIT-PAPPAS-6-8-12.pdf …
- B-SDNY:"Stern [is] the mantra of every litigant who, for strateg. or tact. reasons, would rather litigate [elsewhere]" http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/AMBAC-BK-SD-NY-CHAPMAN-9-23-11.pdf …
- B-SDNY: Stern doesnt prevent BK Ct from approving R9019 compromise & settlement of a claim that’s prop. of the estate. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/AMBAC-BK-SD-NY-CHAPMAN-9-23-11.pdf …
- B-SDNY: "Rare circs" to allow deriv. standing for 3d parties to exist, so settlement of deriv claims by debtor approved http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/AMBAC-BK-SD-NY-CHAPMAN-9-23-11.pdf …
- D-FL: Approp. for BK Ct to rely on plan payments of 3d-party corporate dbtrs to find that indiv. dbtr’s plan is feas. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/SPCP-DC-MD-FL-BUCKLEW-9-21-11.pdf …
- D-FL: Not gerrymandering classes where unsec. cr. is 100% collateralized in the corporate case & other unsecureds arent http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/SPCP-DC-MD-FL-BUCKLEW-9-21-11.pdf …
- D-FL: Broad view of "property incl in the estate under § 1115" means absolute priority rule not applic in indiv ch 11s http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/SPCP-DC-MD-FL-BUCKLEW-9-21-11.pdf …
- B-OH: Emerging majority of Cts conclude that the absolute-priority rule is alive and kicking in individual ch 11 cases. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/HOCKENBERRY-BK-SD-OH-HOFFMAN-9-16-11.pdf …
- B-OH: Use of federal judgment rate or some other int. rate < prime in cramdown is only appropriate for solvent debtors http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/HOCKENBERRY-BK-SD-OH-HOFFMAN-9-16-11.pdf …
- B-OH: Till plurality formula approach applies in ch 11 cramdown absent an efficient mkt for financing the dbtr’s debts. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/HOCKENBERRY-BK-SD-OH-HOFFMAN-9-16-11.pdf …
- B-KY: "Rare" circs warrant departing from typical fee arr. in ch 11 (e.g., mo. pmts w/out ct approval; evergreen ret). http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/USHC-BK-WD-KY-LLOYD-9-23-11.pdf …
- B-GA: Whether consideration in Settlement Agreements was reas. equiv. value depends on "totality of circumstances". http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PALISADES-BK-ND-GA-HAGENAU-9-13-11.pdf …
- B-GA suggests that remedy of constructive trust, if appropriate, can remove property from the estate post-petition. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PALISADES-BK-ND-GA-HAGENAU-9-13-11.pdf …
- B-GA: Cts examine the reas. equiv. value of transfers on antecedent debt to insiders far more closely than to noninsid. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PALISADES-BK-ND-GA-HAGENAU-9-13-11.pdf …
- B-VA: Ch 13 dbtr lacks standing to assert § 544 avoidance action bec. those powers only rest w/the chapter 13 trustee. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/MITRANO-BK-ED-VA-MAYER-9-23-11.pdf
- B-IL: A transfer of assets to a solvent subsid by parent is reas. equiv. value, but a transfer to insolvent one isn’t. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/CENTRAL-BK-CD-IL-FULKERSON-9-23-11.pdf …
- B-IL: Paying debt of another may be a "loan"-not gift-but whether its reas. equiv. value depends on ability to repay. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/CENTRAL-BK-CD-IL-FULKERSON-9-23-11.pdf …
- B-AL sides w/Cts looking at absolute assgnt of rents language as dispositive in removing them from prop. of the estate. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/MCCOMBS-BK-SD-AL-MAHONEY-9-23-11.pdf …
- B-PA: Party putting funds w/out condition in D-Ct escrow w/out rt to recoup has no interest in funds for pref. purposes http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/G&G-BK-WD-PA-MARKOVITZ-9-27-11.pdf …
- B-CT: "Common interest" extension of atty/client priv. can’t be a weapon to obtain privileged materials from jt. defdt. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/NEWENGLAND-BK-D-CT-WEIL-9-26-11.pdf
- SDNY: Filed claim is prima facie evid of validity, shifting burden to objector to produce equally forceful refuting evid http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/MOTORS-DC-SD-NY-SULLIVAN-5-21-12.pdf …
- B-IL: Rooker-Feld allows condo assn to keep possession post-BK until owner complies w/final pre-BK judgment conditions. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/DiGREGORIO-BK-ND-IL-SCHMETTERER-9-28-11.pdf …
- D-PA: Atty must disclose prepetition payments intimately connected to matters that ULTIMATELY contributed to BK filing. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/GEISENBERGER-DC-MD-PA-CONNER-9-23-11.pdf …
- D-PA: Atty failure to disclose conflicts from issuing stock that’s the subject of litigation warrants fee disgorgement. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/GEISENBERGER-DC-MD-PA-CONNER-9-23-11.pdf …
- B-NV: Interim fee entries redacted for atty/client priv. not compensable bec. they don’t comply w/Code’s discl. reqt. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/MONORAIL-BK-D-NV-MARKELL-9-14-11.pdf …
- SDNY affirms BK order that Fairfield Sentry’s center of main int. is BVI, not NY, & granting main recogn. to BVI case. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/FairfieldSentry-SDNY-9-16-11-Daniels.pdf …
- 3d: Pure economic injury isn’t irrep. injury for injunctive relief unless the potential loss threatens co.’s existence. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/MinardRun-3dCir-Roth-9-20-11(1).pdf …
- B-IL: Broker’s commission is earned prepetition when sales contract signed, not at postpet closing, so its estate prop. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/Prochnow-BK-CD-IL-Gorman-9-20-11.pdf …
- B-VA: Bylaws prohibiting debtor with prepet. condo fees due from voting or serving as director of assn violates stay. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/GordonProps-BK-ED-VA-Mayer-9-20-11.pdf …
- SDNY: In light of Manville IV (2d Cir), an approp. Clarifying Order wasn’t entered to trigger Travelers settlement pymt http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/JOHNS-DC-SD-NY-KOELTL-3-1-12.pdf …
- SDNY: Retired ptrs trust lacks stdg to bring cplt for successor/tort-intf claims v. firms purchasing Coudert’s bus. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/COUDERT-DC-SD-NY-MCMAHON-4-12-12.pdf …
- SDNY: No merit to retired ptrs trust cplt for successor/tort-intf claims v. firms purchasing Coudert’s bus. in winddown http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/COUDERT-DC-SD-NY-MCMAHON-4-12-12.pdf …
- SDNY: Order denying remand on mandatory abstention, permissive abstention, & equitable remand grounds is interlocutory http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/EXTENDED-DC-SD-NY-SCHEINDLIN-2-14-12.pdf …
- SDNY: Trustee has jury trial rts on fr. tsf claims that werent waived by commencing the larger SIPA proceeding in BK Ct http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PICARD-DC-SD-NY-RAKOFF-11-23-11.pdf …
- SDNY: Proof of claim filing not nec waiver of jury trial rts in fr. tsf action unless it’s part of claims adjud. process http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PICARD-DC-SD-NY-RAKOFF-11-23-11.pdf …
- SDNY: Right to jury trial implicates private v. public right distinction & fr. tsfs invoke legal & private rights. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PICARD-DC-SD-NY-RAKOFF-11-23-11.pdf …
- SDNY: Picard has jury trial rights in fraudulent tsf action vs. Dfdt until it’s determined it can’t bring those claims. http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PICARD-DC-SD-NY-RAKOFF-11-23-11.pdf …
- SDNY: Pltfs lack standing to bring RICO claims unless "dfdt’s conduct is both the factual & proximate cause of injury" http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/PICARD-DC-SD-NY-RAKOFF-2-22-12.pdf …
- SDNY: Not w/drawing reference of fr. tsf claims consistent w/Stern intent to not signif. change Cts’ division of labor http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/ADELPHIA-DC-SD-NY-CROTTY-1-30-12.pdf …
- SDNY: Stern et al proves that fraudulent transfer claims involve private rights beyond a BK Ct’s final adjudic. power http://www.bankruptcylitigationblog.com/wp-content/uploads/sites/427/uploads/file/ADELPHIA-DC-SD-NY-CROTTY-1-30-12.pdf …
Thanks for reading! More to follow.