Justia.com Opinion Summary
Defendant owned companies forced into Chapter 11 bankruptcy, but was not a debtor in the proceedings. The plan was confirmed and prohibited suits against the bankruptcy professionals and certain litigation against pre-bankruptcy creditors. Years later defendant sued plaintiff, pre-judgment creditors, and the bankruptcy professionals in an Indiana state court, based on Indiana law. The creditors removed the suit to bankruptcy court (28 U.S.C. 1452(a)) rather than asking the bankruptcy judge to enforce his order. The statute authorizes removal of any claim of which that court would have jurisdiction under 28 U.S.C. 1334, which confers on the district courts original jurisdiction of all civil proceedings arising under the Bankruptcy Code, or “arising in or related to cases under” the Code. The bankruptcy judge determined that the suit against the bankruptcy professionals was barred. Defendant filed an amended complaint eliminating all defendants except plaintiff and stating that the only claims arose from alleged violations of confidentiality agreements. The bankruptcy judge ruled that, as amended, the complaint was unrelated to the bankruptcy and ordered the suit remanded to the state court. The district judge affirmed. The Seventh Circuit concluded that the dismissal was not subject to review.
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Posted in appellate court, bankruptcy, business, business filings, ch 11, cir 7, confirmed plan, current-events, data, debt, IND, removal jurisdiction, state court
Tagged Bankruptcy, Chapter 11 Title 11 United States Code, Indiana, law, Lawyers and Law Firms, Services, United States, United States Court of Appeals for the Seventh Circuit
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Justia.com Opinion Summary:
Wisconsin smelting plant owed more than $1.3 million in delinquent utility charges to the local municipal utility when it filed for Chapter 11. Months later, despite the Automatic Stay, a utility company implemented a process pursuant to Wisconsin Statutes and Local Ordinances 66.0809 and 66.0627 by which the plant’s unpaid utility bills became a lien against the Debtor‘s property. Both the Bankruptcy and District Courts found that none of the exceptions to the Automatic Stay applied to make their actions. They were, in fact, a violation of the Stay. The 7th Circuit Court of Appeals affirmed, holding that no exception to the Stay applied and the offending utility company creditor did not obtain a pre-petition security interest in the plant’s property by providing services or by giving notice in the form of billing. Finally, the 7th Circuit agreed with the District Court that the utility bills produced did not amount to a “tax or special assessment” that would have exempted them from the operation of the Stay.
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Posted in automatic stay, business, business filings, case update, ch 11, cir 7, current-events, data, docket, Fed. R. Bankr. Proc., opinion, WIS
Tagged Automatic Stay, Bankruptcy, Debtor, Local ordinance, Public utility, United States, United States Court of Appeals for the Seventh Circuit, Wisconsin
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College Illinois lets parents invest today and lock in tuition for their kids down the line. Now Attorney General Lisa Madigan has opened a review of the program. The commission has run a deficit of over $300 million for 2 years due to lax investment practices like its $12.8 million in Shorebank Corp., which collapsed last year. Spokespeople for the commission say they were attempting to keep pace with the cost of higher-education … but lost everything instead. Oops! Now it looks like the system is out of money; and since investments are not guaranteed, the investors (parents) appear to be out of luck.
Posted in current affairs, current-events, data, debt, default, depreciation, economics, economy, fiduciary, IL, individual, investments
Tagged Attorney General, Auditor General, College Illinois, Lisa Madigan, State of Illinois
… but still in the national top 10, meaning that 1 in 550 housing units in Illinois is now in foreclosure. That in turn translates to roughly 1 out of every 10 residential homes.
But the real scourge of the real estate market is that is has hollowed out entire blocks and permanently affected the ability of homeowners to move, sell, divorce, or refinance. Most are stuck, and many are stuck paying for more house than they actually have.
Posted in current affairs, current-events, data, debt, default, depreciation, economy, foreclosure, IL, individual, investments, liability, lists, loan, Middle class, mortgage, obama, property, reaffirmation, real property, research, short sale, state court, statistics, stimulus package, subprime, subprime mortgage
This article in CNNMoney identifies 9 credit cards industry experts told CNNMoney were among the worst in America for nose-bleed interest rates and ridiculous fees. Here’s the list:
- Applied Bank Unsecured Visa Gold Card
- First Premier Bank MasterCard
- Baby Phat Prepaid Visa RushCard
- Hooters MasterCard
- The Shack Credit Card
- Shell Select Member Card
- Visa Black Card
- JCPenney Rewards Credit Card
- Household Bank Premium Platinum MasterCard
Posted in article, bankruptcy, ch 13, cir 7, consumer, credit, credit card, credit cards, credit counseling, creditor, current-events, data, debt, economy, individual, means test, research, retail, subprime, wealth
Harris N.A. v. Gander Partners LLC ,(N.D.Ill.)
Issue: When an LLC is in Chapter 11 reorganization, can a creditor collect directly from the principals of the company instead?
Answer: Apparently not in the Northern District of Illinois
Upshot: Here, the Court upheld an injunction entered by the Bankruptcy Court after determining that
- The participation of these principles was essential to the company’s reorganization
- If these principles were distracted by this lawsuit the reorganization would likely fail
- Many other creditors would be harmed financially if this reorganization failed; and
- The creditor seeking to collect only faced only a temporary stay, anyway.
In the immortal words of Spock, circa Star Trek II, the needs of the many outweigh the needs of the few.
Posted in assets, attorneys, avoidance, bad faith, bankruptcy, business, business filings, case update, ch 11, ch 13, ch 7, cir 7, collateral estoppel, confirmed plan, consumer, corporation, credit, creditor, current-events, data, debt, discharge, ED, fiduciary, IL, individual, ND, opinion, research
Tagged liability of corporate principals
In re Braden J. Adolph, 09-32836
Issued: January 28, 2011
By: A. Benjamin Goldgar
The Issues: The proper use and interpretation of 11 USC 707(a) and (b), the dynamic duo of bankruptcy dismissal. Under consideration is the distinction between dismissal for cause via 707(a) and the presumption of abuse in 707(b).
The Upshot: Judge Goldgar engages in a close analysis of 11 USC 707 and determines that bad faith is not a reason to dismiss under 707(a) and only consumer debts can be excepted from discharge under 707(b) – especially in light of BAPCPA. In this case, where an Attorney seeks his fees from a business debtor of his Client, the Court finds him to be out of luck – not a consumer debt, and not a bad faith filing. Boom shakalaka.
Click here to view and download the opinion in .pdf format.
Posted in 707, bad faith, bankruptcy, Bankruptcy Rules, business, business filings, case update, ch 7, cir 7, consumer, corporation, current-events, data, debt, discharge, dismissal, docket, ED, fraudulent transfers, goldgar, IL, individual, judge, legislation, motion, motion to dismiss, ND, opinion, order, research, small business
Tagged Bankruptcy, Bankruptcy Abuse Prevention and Consumer Protection Act, Debt, law, Lawyers and Law Firms, Services, Title 11 of the United States Code, United States