In a perfect world, a debtor's bankruptcy would involve timely reporting, good faith filings, and full disclosures. Unfortunately, some debtors either enter the process under a cloud of suspicion or make decisions during the process that suggest the estate has been compromised by fraudulent activity. Whether the alleged fraud is a complex bust-out scheme or a simple unreported asset transfer, the debtor may face a serious investigation. Depending on the extent of the allegations, the investigation could be referred as a criminal matter to federal prosecutors. As the
In Salyersville Nat’l Bank v. Bailey (In re Bailey), 664 F.3d 1026 (6th Cir.
On July 2, 2012, the Illinois Department of Insurance (IDOI) entered an Agreed Order of Rehabilitation against Lumbermens Mutual Casualty Company and American Manufacturers Mutual Insurance Company, which is the part of the Lumbermens Mutual Group formerly known as Kemper (collectively, “Lumbermens”). Under the order, IDOI’s Director will serve as Lumbermens’ Rehabilitator with powers to restructure Lumbermens’ insurance business. From this point forward, Lumbermens will no longer take on any new insurance obligations, issue any new policies, or renew any existing policies.
In a recent decision1 involving Global Aviation Holdings, Inc.
Given the spate of bankruptcies filed over the last few years, including by large-scale tenants such as Borders, Linens 'n Things, and Circuit City, and the tenuous financial condition of big-box retailers such as Best Buy, it is important for both landlords and tenants to understand the benefits and limitations of bankruptcy protection as it relates to the status of a bankrupt tenant’s leasehold interest.
In somewhat related news, in two recent New York Supreme Court rulings, judges upheld the validity of “bad boy” guarantees that included as non-recourse exceptions or “bad boy” acts under the guarantee a voluntary bankruptcy filing by the borrower.
If you are one of the lucky product manufacturers who weathered the recent economic downturn well and are looking to buy assets from those who did not survive…beware!
The United States Bankruptcy Court for the Northern District of Ohio recently held that under Ohio law, the homestead exemption set forth in Ohio Rev. Code Ann. § 2329.66 applies to contiguous parcels of land only if those parcels are used for a single purpose as the debtor’s homestead. In re Whitney, 459 B.R. 72 (Bankr. N.D. Ohio 2011).
Turnaround Management Association
The United States is about to enter year five of what has been aptly deemed “The Great Recession.” Bankruptcy advising is a cyclical business, and after a dearth of work in the heady financial years of the mid-2000s, expectations were high that in the downturn bankruptcy work would be abundant and steady.
Last month, the U.S. Supreme Court agreed to hear another bankruptcy case and this one could have a profound effect on a lender’s bidding rights when its collateral is up for sale. RadLAX Gateway Hotel, LLC v. Amalgamated Bank, No. 11-166, cert. granted Dec.