Here’s an aggregation of some of my Twitter posts from June 1-7 2018, with links to important cases, articles, and news briefs that restructuring professionals will find of interest. Don’t hesitate to reach out and contact me to discuss any posts. Thanks for reading!

BK RELATED CASES:

 

INTERESTING CASES FROM ILLINOIS AND OTHER COURTS:

• Personal Jurisdiction – 7th Cir:   “Directing pleadings, discovery, and other litigation communications to an Illinois citizen facing suit in some other state—even in furtherance of a tortious scheme—is simply not the same as targeting that citizen in Illinois.” John Crane Inc v Shein Law Center Ltd
• Mandatory Arbitration – Cook County – IL AP 1:  “The Illinois Supreme Court authorized the Cook County mandatory arbitration program and thus approved any deviations between that program’s rules and the Illinois supreme court’s rules.” Jones v State Farm Mutual Automobile Insurance Company
• Systematic Oppression in the Federal Judiciary and Legal Profession – SD-MS:  Instead of entering a routine order appointing a receiver in an SEC enforcement action, US District Judge Reeves takes the opportunity to rail against the lack of diversity in the federal judiciary and the legal profession. . . . The Court believes that particular care is necessary in appointing officers of the federal judiciary, an institution that fails to reflect the diversity of the public it serves. . . . It is indisputable that systematic oppression lies behind much of the judiciary’s lack of diversity. . . . Deeper patterns of exclusion appear in Mississippi. The Court will require the Receiver to take steps to guarantee its hiring practices are as inclusive as possible.” Securities And Exchange Commission v Adams

BK RELATED NEWS & ARTICLES:

• 546(e)’s Safe Harbor: “Merit narrowed Sec 546(e) safe harbor wrt transfers that pass through qualified entities but not for warehouse lending structures relying on the use of custodians or agents to qualify an otherwise nonqualified entity as a qualified entity.” Structured Finance Is Safe Despite Merit Ruling, via LAW360
• Archdiocese of St. Paul & Minneapolis BK Timeline:  Seeing the forest for the trees (May 2013 – May 2018). Timeline of archdiocese’s bankruptcy proceedings, via The Catholic Spirit
• Fraudulent Transfers and the US Supreme Court:  I think it’s fair to say that Don is mad as hell and isn’t going to take it anymore! Fraudulent Transfers: U.S. Supreme Court Lets an Injustice Stand (Henry v. Weiss), via MediatBankry Blog
• Lamar Analyzed:  Good summary here by Don Swanson of the US Supreme Court’s decision in Lamar v. Appling. Defining and Illustrating “Statement Respecting Financial Condition” for Nondischargeability: U.S. Supreme Court (Appling Case), via MediatBankry Blog
• Propriety of a BK Judge Testifying in a BK Atty’s Disciplinary Action Related to the BK Case:  The Texas Appellate Court rules 2-1 that the testimony of Judge Isgur, who oversaw the BK case in which the debtor’s attorney lied & hid assets, wasn’t necessary in a disciplinary action and should not have testified, especially since the jury had no special instructions to evaluate his testimony. Disbarred Texas Atty Wins New Trial For Alleged Misconduct, via LAW360
• Shoot the (BK Lawyer) Messenger:  Here’s a “shoot the messenger” argument. “There are not as many bankruptcy cases and there are, frankly, a lot of bankruptcy professionals. When they do get a case, the case becomes litigious, they are going to fight every issue to the death.” The Rise of Creditor-on-Creditor Violence, via Institutional Investor
• Third-Party Plan Releases:  Excellent reference guide to the current state of the case law. The Changing Landscape of Consensual Third-Party Releases in Chapter 11 Plans: Does Silence = Consent?, by Katherine A. McLendon and Lily Picon of Simpson Thacher & Bartlett, via Harvard Bankruptcy Roundtable

LAW RELATED NEWS & ARTICLES:

• Advocacy Tips:  “When someone, especially a lawyer, is prepared to be not straightforward, and cute, and I would say misleading with the Court on the tiniest of matters, it raises a serious question about how that lawyer will conduct himself on more serious matters.” Michael Avenatti withdrew his petition to be admitted into Michael Cohen’s case after Trump’s lawyer hit him with a broadside in court, via Business Insider
• Covenant Lite’s Consequences – “Pulling a J. Crew”: “With retailers dominating lists of troubled issuers, speculation is about who’ll be next to ‘pull a J. Crew.’ Petsmart’s transfer of assets to an unrestricted subsidiary wasn’t surprising given what J. Crew was able to do with its transfer of intellectual property under its loan documents, James Wallick of Xtract Research said in an interview. The move is ‘symptomatic’ of the current market for loans and bonds, where agreements ‘are so flexible that you can do a transaction such as this.’ ” PetSmart Moves Part of Chewy.com Out of Creditors’ Reach: Retailer is said to shift over a third of Chewy’s assets, via Bloomberg
• Food Truck Ordinance’s Constitutionality:  “The Illinois Supreme Court will review a Chicago ordinance requiring food trucks to stay at least 200 feet from brick-and-mortar restaurants and a requirement the trucks maintain GPS monitoring devices onboard.” Cupcake truck’s constitutional claims to go before Illinois Supreme Court, via Chicago Daily Law Bulletin
• Free Speech, Roseanne, and the NFL:  From University of Chicago Law School Professor Geoff Stone, one of the the nation’s premiere 1st amendment scholars, and former clerk to Justice Brennan. Roseanne Barr and the NFL: What Counts as Free Speech? Neither are First Amendment issues – but is there a difference between football players taking a knee and ABC canceling hit show over racist tweet?, via Rolling Stone
• Jay-Z Copyright Suit:  After 11 yrs. of litigation, the 9th Cir. dismissed a lawsuit against Jay-Z over a sample used in his song “Big Pimpin’,” ruling that so-called “moral rights” protected under Egyptian copyright law cannot be enforced in U.S. courts. Jay-Z Beats Copyright Suit Over ‘Big Pimpin” At 9th Circ., via LAW360
• Law Firm Partner Wars (1):  “I would say . . . what is unusual here is the allegation that the firm would try to use an unenforceable forfeiture for competition clause as leverage to extract an agreement not to make offers to any associates.” Quinn Emanuel Tiff With Ex-Partners Raises Ethics Questions, via LAW360
• Law Firm Partner Wars (2):  The 79 page complaint by Selendy & Gay against Quinn Emanuel is included in this post and can be downloaded. John Quinn Wants Partners to Regret Leaving His Firm: When leaving your Biglawfirm gets really ugly, via Above the Law Blog
• Minority Rights of LLC Interest Owners:  “The MA Supreme Ct rules that a minority shareholder in an LLC may be entitled to a little something extra if a secret merger takes place over its objection that it breaches fiduciary duty, but that remedy may not include calling off the union altogether.” Mass. Top Court OKs Extra Benefits For Covert LLC Mergers, via LAW360
• Privacy – Data Protection Suits in Europe:  “If these types of complaints succeed, and they could given the current antipathy toward American tech giants and the satisfaction that European officials might take in kneecapping a few of them, it could be a watershed moment for large tech companies.”  The Privacy Lawyer Giving Big Tech an $8.8 Billion Headache, via NYT
• Religious Significance of US Motto:  Satanist’s attempt to remove G-d’s name from US currency loses “not because we think that the phrase ‘In G-d We Trust’ is absolutely devoid of religious significance, but because the religious content it carries doesn’t go beyond statutory or constitutional boundaries.” 7th Circuit agrees: ‘In God We Trust’ motto not a religious endorsement, via Chicago Daily Law Bulletin
• Scalper Bots & Copyright Infringement:  “The [scalpers’] bot developers copied its webpages and code, thereby infringing its copyrights. There is no part of Ticketmaster’s terms of use agreement that allowed for the copying and downloading of its site,” Judge Wright (CD-CA) said. Alleged Scalpers Must Face Ticketmaster’s Infringement Suit, via LAW360
• Spoliation: “Judge rules ‘the evidence was overwhelming & undeniable’ that Relativity falsified the memorandum by Kavanaugh himself, noting that the memo had been modified by a user who signed in as ‘kav kav,’ noting that must be Kavanaugh.” Relativity Faked Memo Accusing Executive of Sexual Harassment, Judge Rules, via Hollywood Reporter

LIFE AND THE WORLD GENERALLY:

• Amazon’s Expansion Model:  “As a small company, you’ve got to be the minnow that swims in and out of the mouth of sharks. If you get lazy, that mouth might close on you.” ‘You’re Stupid If You Don’t Get Scared’: When Amazon Goes From Partner to Rival: The giant’s cloud-computing business offers a look inside its model for expanding. Some partners praise the unit’s chief for straddling the line between ally and competitor, via WSJ
• Cancer Cures:  There’s no universally effective immunotherapy treatment because “it’s a collision of 2 extraordinarily complex systems:  cancer and the immune system. So you are in the biology of a run-and-chase where tumors continuously evade immune recognition and attack.” Oncologists dare to talk of a ‘cure’ in fight against cancer: Genetic research advances are making truly personalised treatments a reality, via FT
• Einstein’s “Block Universe” Theory:  How does G-d know everything? Are our departed loved ones really here with us? “Einstein, for his part, hewed to the ‘block universe’ picture of space-time, according to which the future already exists, as much as the past does. But time itself proves very difficult to pin down. Perhaps the best definition of it is the one semi-jokingly quoted by the physicist John Wheeler : ‘Time is nature’s way to keep everything from happening all at once.’ ” When Einstein Walked With Gödel’ Review: Plato, Physics and Brains in Space: A collection of previously published essays by science writer Jim Holt, exploring mind-bending ideas such as the “Boltzmann brain”, via WSJ
• Fear of Self-Driving Cars:  “Our daydreams of automated chauffeurs may have to await a new paradigm that better mimics our distinctive human ability to integrate new knowledge w/old, applying common sense to novel situations & exercising judgment as to which risks are worth taking.” Why We Find Self-Driving Cars So Scary: Take note, Elon Musk, even if autonomous cars are safer overall, the public will accept the new technology only when it fails in predictable and reasonable ways, via WSJ
• Lincoln and Leadership:  “Lincoln was made into an effective leader—1st from the inside out, then from the outside in. As president, he refused to ignore the larger consequences of his actions on those with little or no agency and an ethical callousness about choices he made.” The Leadership Journey of Abraham Lincoln, via McKinsey Quarterly
• Major League Baseball’s Kids:  Per Peter Moylan of the Atlanta Braves, “The whole ‘earn stripes’ thing, sit in the corner & don’t say anything, those times have gone. Now it’s more, ‘these guys have a chance to help us, let’s make ’em feel as comfortable as they can the minute they get up here.’ ” The Front End of Baseball’s New Youth Movement: The Atlanta Braves have been baseball’s biggest surprise. The reason? A bunch of players barely out of high school, via WSJ
• Power Investing:  “Market participants had underestimated how many of the owners of classic centralized generation would take their chips off the table and how little new capital would be committing to this game.” Surviving US power generators bring home the cash: ‘Capacity’ price for America’s largest grid surge to $140 per megawatt day, via FT
• Private Equity Procurement Strategies:  “A successful procurement transformation [by private equity] can increase run-rate EBITDA by up to 20 percent” Digital procurement in private equity: Unlocking sustainable impact, via McKinsey
• Private Equity Time Horizons:  “Of all the confidence tricks in financial markets, the idea that 3-5 yrs means long term is among the most brazen. The private equity industry has tried to turn this into conventional wisdom, helped by the fact that public companies live from one quarterly earnings to the next.” An unusual family approach to investing: JAB’s acquisition of Pret A Manger resembles private equity but with a long-term twist, via FT
• Richard Thaler on Overcoming Bias in Corporate Decision-Making:  Richard Thaler explains the roots of the Peter Principle: “Job interviews are, to a 1st approximation, useless—at least the traditional ones, where they ask you things like, ‘What do you see yourself doing in ten years, or what’s your biggest weakness?’ ” Debiasing the corporation: An interview with Nobel laureate Richard Thaler, via McKinsey Quarterly
• Tech Growth:  “One of Silicon Valley’s top analysts and investors has warned that growth will become more difficult and the landscape more competitive for tech companies now that more than half of the world’s population are online.” Mary Meeker warns tech giants that growth will be harder to find: Veteran Silicon Valley analyst sees competition intensifying now half the world is online, via FT
• Tripping in Hospice:  “Pollan describes a dying cancer patient named Patrick Mettes, who sat up during his psychedelic treatment and said, ‘Everyone deserves to have this experience.’ ” Michael Pollan Drops Acid — and Comes Back From His Trip Convinced, via NYT

 

©2018, Steve Jakubowski