On July 9, 2012, the U.S. Court of Appeals for the Seventh Circuit issued its decision in Sunbeam Products, Inc. v. Chicago American Manufacturing, LLC (“Sunbeam”). It is a landmark opinion for trademark licensees whose licenses are rejected in bankruptcy by trademark owners.
The Government must provide actual notice of forfeiture proceedings to those the Government knows have claimed an interest in property to be forfeited. In a fact pattern the Sixth Circuit characterized as "befitting a John Grisham novel," the Government dug up (literally) a fraudster’s $250,000 on a golf course. The Government found the money in October 2009 and instituted forfeiture proceedings. In November and December 2009, the Government posted a generalized notice of forfeiture on the internet.
The Pension Benefit Guaranty Corporation (PBGC) filed an objection on June 14, 2012, in the Delaware bankruptcy court proceedings of RG Steel ("Debtor"), challenging a recent sale by RG Steel's parent entity ("Parent") of a 25-percent ownership stake in the Debtor. If the sale is respected, Parent would fall outside of the Debtor's "controlled group" under the Employee Retirement Income Security Act (ERISA), with the result that Parent may cease to have joint liability for the Debtor's unfunded pension obligations.
In Loop 76, LLC, the Bankruptcy Appellate Panel for the Ninth Circuit (the “BAP”) recently held that a bankruptcy court may consider whether a creditor received a third party source of payment (e.g., a guaranty) when determining whether that creditor’s claim is “substantially similar” to other claims for purposes of plan classification under 11 U.S.C. § 1122(a). In re Loop 76, LLC, 465 B.R. 525 (B.A.P. 9th Cir. 2012).
Where an insured has assigned away its rights to recover available insurance, the insured’s “empty shoes” do not necessarily prevent an excess carrier that pays defense costs rightfully owed by primary carriers from pursuing the primary carriers based a contractual subrogation theory. An excess carrier proceeding on this basis typically “stands in the shoes of the insured,” obtaining only those rights held by the insured. Nonetheless, the Fifth Circuit Court of Appeals found last week that where an excess carrier picks up the bill for an insured’s defense, it may recover fr
The U.S. Supreme Court issued a unanimous decision on May 29, 2012, finding that a chapter 11 bankruptcy plan of liquidation is not confirmable over a secured lender’s objection if such plan prohibits the lender from credit bidding at a sale of its collateral.1 See RadLAX Gateway Hotel, LLC et al. v. Amalgamated Bank, No. 11-166, 566 U.S. ___ (2012).
On May 14, 2012, the Third Circuit Court of Appeals in In re Heritage Highgate, Inc., et al., No. 11-1889 (3d Cir. May 14, 2012) clarified the burden of proof with respect to the valuation and ultimate allowance of alleged secured claims under Bankruptcy Code section 506(a).
In Senior Transeastern Lenders v. Official Committee of Unsecured Creditors (In re TOUSA, Inc.), the Eleventh Circuit Court of Appeals reinstated the decision of the United States Bankruptcy Court for the Southern District of Florida (the “Bankruptcy Court”) in which the Bankruptcy Court avoided the liens given by TOUSA’s subsidiaries to new lenders and permitted the recovery of the proceeds of the new loan from other TOUSA lenders that had taken the funds in repayment of their TOUSA guaranteed loans.
Relying on the U.S. Supreme Court’s decision inAT&T Mobility LLC v. Concepcion, the Ninth Circuit Court of Appeals recently held that California’s rule against compulsory arbitration of claims for public injunctive relief was preempted by the Federal Arbitration Act (“FAA”). The Court also underscored the key points of an enforceable arbitration clause. Kilgore v. KeyBank (March 7, 2012).
Case Background
On February 8, 2012, the Pennsylvania Insurance Department (the “Department”) announced that the Pennsylvania Commonwealth Court approved its petition to liquidate First Sealord Surety Insurance.
According to the Department's Commissioner, Michael Consedine, the Department petitioned the Commonwealth Court for a liquidation order because “First Sealord Surety is no longer able to meet its policyholder obligations or pay its debts as they come due.”