On September 13, the OCC published a proposed rule under the authority of the National Bank Act, to provide a framework for receiverships for national banks that are not insured by the FDIC.

(Bankr. W.D. Ky. Sep. 12, 2016)

The bankruptcy court grants the motion to terminate the automatic stay. The creditor and the debtor entered into a sale contract prepetition for sale of the debtor’s real property. The debtor argued that the sale contract terminated prepetition, and the creditor argued that it should be permitted to pursue its claims on the contract in state court. The court finds that the debtor has no equity in the property and that it is not necessary to an effective reorganization. Thus, stay relief is appropriate. Opinion below.

Judge: Lloyd

(Bankr. W.D. Ky. Sep. 1, 2016)

The bankruptcy court addresses the issue of whether the debtor’s prepetition claim for a surcharge before the Public Service Commission is property of the estate. The pre-petition receiver for the debtor argued that it was not, because the debtor abandoned its assets prepetition in the PSC action. The court disagrees, finding that legal title was not severed in the prepetition proceedings, and thus the bankruptcy trustee has control and authority over the surcharge claim. Opinion below.

Judge: Lloyd

(7th Cir. Aug. 23, 2016)

Focus on the AB InBev and SABMiller merger

(W.D. Ky. Aug. 15, 2016)

On August 4, 2016, the Consumer Financial Protection Bureau (CFPB) issued updated servicing rules to expand foreclosure protections for homeowners and struggling borrowers. The new measures include expanding consumer protections to surviving family members, clarifying borrower protections in servicing transfers, providing periodic statements to borrowers in bankruptcy, and requiring servicers to provide certain foreclosure protections more than once over the life of the loan, among other protections.

The Seventh Circuit dismisses the appeal, holding that the bankruptcy court’s final order implementing the district court’s order directing turnover of assets to the bankruptcy estate was valid, because it resolved a core proceeding. The appellants contended that it was a non-core proceeding and thus required a district court order to be final. Opinion below.

Judge: Posner

Attorney for Appellants: Jordan Law P.C., Terrence M Jordan

On June 30, 2016, the United States Senate passed the “Puerto Rico Oversight, Management and Economic Stability Act” (“PROMESA”) and it was quickly signed into law by President Obama.^[1] PROMESA enables the Commonwealth of Puerto Rico and its public corporations and other instrumentalities in financial distress to restructure their debt.

(6th Cir. B.A.P. Aug. 4, 2016)