Here’s an aggregation of some of my Twitter posts from May 1-6, 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.

May 1 – 6, 2018

BK RELATED CASES:

  • 3d Cir:  “The BK Ct didn’t consider the faster payment rate in isolation. Rather, it considered the 19 day difference in the context of the parties’ relationship, similarity of transactions, the manner in which payment was tendered, [the creditor’s new and unusual collection efforts during the Preference Period, and [the creditor’s] actions after learning of [Debtor’s] hardship. We agree w/the BK Ct analysis that, taken as a whole, [the creditor’s] conduct in the Preference Pd. deviated from the parties’ ordinary course of business practices.” In re AE Liquidation Inc
  • 8th Cir The “weak presumption that property purchased with entirety funds takes on the character of entirety property” fails to meet the higher evidentiary threshold necessary to establish the existence of a partnership. Cutcliff v Reuter
  • 9th Cir:  In a move you don’t see often, the 9th Cir. concisely summarizes Caremark and duty of care claims under Delaware Law. In re KSL Media Inc
  • BAP-6If the Debtors’ interest in certain real property was only a nontransferable equitable interest, as opposed to a transferrable legal interest, the trustee could not use, sell, or lease that interest and it would have no consequential value to the trustee. While the trust holds legal title to the property, the trust provisions allow the Debtors (and then others) to occupy it for the duration of their lives. Nothing in the document conveys legal title to the Debtors. Therefore, the Debtors’ interest is equitable in nature (and the parties agreed that if the Panel were to affirm the bankruptcy court’s determination that the Debtors’ interest was an equitable life estate that it would not be subject to turnover). In re Blasingame
  • D-CT:  Interesting litigation over an attorney opinion letter that opined as to the company’s corporate authority and due authorization to enter into the transaction. Court holds that “[t]he Opinion Letter is not a contract” and “Plantiffs do not have a claim as 3d party beneficiary.” Hence the breach of contract claim fails. UC Funding I LP Trustee v Berkowitz Trager And Trager LLC
  • B-ND-IL:  Judge Goldgar in Caesars rejects an agreed protective order because “the proposed order would have had the court find there had been ‘good cause shown,’ and no such showing had been made.” In re Caesars Entertainment Operating Co Inc
  • ND-IL:  “In sum, no precedent saves UPB’s counterclaim for equitable estoppel from § 1821(j)’s sweeping ouster of the courts’ power to grant equitable remedies.” FDIC, as Receiver for Seaway Bank v. Urban
  • ND-IL Court denies assignee for benefit of creditor’s motion to dismiss Lubrizol’s action against it for breach of fiduciary duty action for misdirecting payments that should have gone to the debtor’s former parent (Delta) but was accidentally sent to the debtor/assignor. “If the Court accepts as true the allegation by Lubrizol that the Trustee knew that the Delta payments did not actually belong to [the debtor/assignor], that would certainly infer a lack of good faith in the management of matters relating to the trust and would not comport with the terms of the Trust Agreement.” Lubrizol Corporation v Olympic Oil Ltd
  • MD-NC:  Court examines the record in detail in determining whether the BK Ct was right to dismiss a second voluntary petition filed the day after the same judge dismissed the first one. In re Rain Tree Healthcare of Winston-Salem LLC
  • B-WD-OK:  “The Court finds it incredulous that [the atty w/30 years of experience] would pay himself $348,404 in fees related to the bankruptcy over a two year period and not deem it appropriate to make any disclosure of the same before being ordered to do so by the Court.” In re Stewart
  • B-WD-PA:  The Stipulated Order did not extend the time for the Debtor to remove property  (i.e., the Mirrors) from the business premises, nor did it restrict the previous authorization granted to Landlord to exercise self-help remedies after vacation date.  Debtor’s motion for turnover and unjust enrichment against landlord to recover mirrors seized after vacation date denied. In re Flabeg Solar US Corporation
  • ED-PA:  Applying collateral estoppel would foreclose the possibility that the involuntary bankruptcy petitions against NMI were properly motivated, but that the filing against Rosenberg was not. . . . That result would not be warranted given the differences between the two proceedings and the underlying facts. Thus, the Court concludes that there is not sufficient identity of issues to permit offensive collateral estoppel.” National Medical Imaging LLC v US Bank NA

Interesting Non-Bankruptcy Cases from Illinois Courts:

  • 7th Cir:  Illinois recognizes three exceptions to economic loss rule: for personal injuries or property damage resulting from sudden or dangerous occurrences, for fraud, and for negligent misrepresentations by professional business advisors. Community Bank of Trenton v Schnuck Markets Inc
  • ND-IL:  “Taking all reas. inferences in ATG’s favor, the Ct can’t find the Agreement’s non-competition is geographically unreasonable as a matter of law at this stage, esp. in light of ATG’s assertions about its biz & the relatively short duration of the clause.” American Transport Group v. Power

 

LAW RELATED ARTICLES:

 

NEWS:

 

LIFE:

 

Thanks for reading!

©2018, Steve Jakubowski