NORTH CAROLINA – Asbestos claimants (claimants committee) in this Chapter 11 case filed a motion to dismiss the bankruptcy case filed by Georgia Pacific (GP) for its acquisition of Bestwall arguing that the petition was filed in bad faith and established a reorganization that was “objectively futile.”

Asbestos litigation has been consistently active throughout the United States since the first asbestos lawsuit was filed in the 1970s. As the population of asbestos plaintiffs has grown over the last 40 years, so have the funds paid by various asbestos defendants. This growing financial burden has caused numerous asbestos defendants to file for bankruptcy. In doing so, the insolvent defendants are required to create asbestos trust funds for the protection of future asbestos plaintiffs. To date, there are over 50 active asbestos bankruptcy trusts in the U.S.

Federal law has long excepted student loans from discharge in bankruptcy in all but the rarest instances, recognizing the problems (and costs) associated with allowing borrowers to wipe out defaulted debts through a bankruptcy filing. However, as the issues of access to college and affordability become frequent topics in political discourse, new ideas for radical changes to the treatment of student loan debt in bankruptcy have been proposed. Lenders and servicers need to be up to speed on those proposals and ready to adjust their operations if any become law.

In a unanimous, and perhaps unsurprising, decision, the Supreme Court determined that a creditor may be held in civil contempt for violating the discharge injunction if there is “no fair ground of doubt” as to whether the creditor’s conduct was barred by the order placing that injunction. The Supreme Court declined to adopt the standard of either of the courts below – the bankruptcy court’s strict liability standard or the Ninth Circuit’s good faith belief “even…if unreasonable” standard.

The Supreme Court reminded bankrupt debtors on Monday that mere rejection of a contract does not turn back the clock to avoid contractual obligations. This was the thrust of its holding in Mission Product Holdings, Inc. v. Tempnology, LLC, which held that a rejection of an executory contract—in this case, a trademark license—under Section 365(a) constitutes a breach of the contract, not a rescission.

After an individual debtor receives a bankruptcy discharge, a creditor may not seek to recover the discharged debt. Under section 524(a)(2) of the Bankruptcy Code, a discharge injunction permanently enjoins creditors from trying to collect discharged debts and prohibits a creditor from collecting any debt where the debtor has been discharged of personal liability.

A recent decision by a federal appeals court appears to open the doors of United States Bankruptcy Courts nationwide… or does it? The Ninth Circuit’s decision from Garvin v. Cook Investments provides a helpful roadmap for understanding the challenges and opportunities for marijuana-related businesses considering their access to bankruptcy courts.

Marijuana Businesses Generally Violate Federal Law

The intersection of Chapter 13 bankruptcy and escrow accounts is complicated and confusing. Since 2011, various bankruptcy rule and form changes have occurred in an effort to eliminate perceived problems with Chapter 13 escrow issues. This article explains how one of these changes – a revised version of a proof of claim attachment form – actually added to the confusion instead of alleviating it, and how that confusion can be costly to servicers.

Official Form B410A

United States District Court, W.D. Pennsylvania, May 30, 2019

PENNSYLVANIA – The defendant Johnson & Johnson (J&J), in a topic that has been extensively covered by the Asbestos Case Tracker, indicated in its notice of removal that this case is one of many in the United States which involve claims concerning personal injuries and deaths allegedly caused by J&J’s cosmetic talc. J&J’s motion further indicates that the “sole supplier” of the talc which the defendant used in its product, filed for bankruptcy under Chapter 11.

Creditors and credit furnishers often find properly reporting a payment status to Credit Reporting Agencies (CRAs) during, and after, bankruptcy a challenge. The recent Report of the American Bankruptcy Institute on Consumer Bankruptcy recognizes those challenges, and looks to convene a forum to provide better guidance and clarity as to proper credit reporting once a borrower goes into bankruptcy.

Challenges