One overarching certainty of federal debt collection law seems to be prolonged uncertainty over its appropriate scope. Is this scope about to change yet again? One recent bill called the Practice of Law Technical Clarification Act of 2017, H.R. 1849, seeks to do just that.

On 2 September 2016, Hanjin filed a petition under Chapter 15 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of New Jersey, seeking recognition of its Korean rehabilitation proceedings as a "foreign main proceeding." Hanjin also sought provisional and final relief to prevent creditors from taking enforcement actions against Hanjin's interests within the jurisdiction of the United States.

On June 16, 2016, the Official Committee of Unsecured Creditors (the “Committee”) of Kid Brands Inc., et al. (the “Debtors”), filed approximately 64 complaints seeking the avoidance and recovery of allegedly preferential and fraudulent transfers under Sections 547, 548 and 550 of the Bankruptcy Code. The Committee also seeks to disallow claims of such preference defendants under Sections 502(d) and (j) of the Bankruptcy Code.

The U.S. District Court for the District of New Jersey recently dismissed a debtor's claims for violations of the federal Fair Debt Collection Practices Act (FDCPA) and the New Jersey Truth in Consumer Contract Warranty and Notice Act (TCCWNA), holding the debtor's failure to schedule his lawsuit as an asset of his bankruptcy estate deprived him of standing to later assert the claims.

A copy of the opinion is available at: Link to Opinion

The U.S. District Court for the District of New Jersey recently dismissed a debtor’s claims for violations of the federal Fair Debt Collection Practices Act (FDCPA) and the New Jersey Truth in Consumer Contract Warranty and Notice Act (TCCWNA), holding the debtor’s failure to schedule his lawsuit as an asset of his bankruptcy estate deprived him of standing to later assert the claims.

TRIA Renewal Legislation Considered by the House Financial Services Committee

The US House of Representatives Financial Services Subcommittee on Oversight and Investigations (Committee) has released a report on the collapse of MF Global (Report). The Report finds that Jon Corzine, MF Global’s Chairman and CEO, made a number of decisions that ultimately caused MF Global’s bankruptcy. The Committee also found fault with the regulatory agencies, rating agencies and the New York Federal Reserve Board, among others.

The Bottom Line:

The U.S. Bankruptcy Court for the District of New Jersey recently held that a Cayman Islands collateralized-debt obligation issuer (“CDO”) could be a debtor under Chapter 11 of the U.S. Bankruptcy Code (the “Bankruptcy Code”) and declined to dismiss an involuntary case commenced against the CDO by certain noteholders on the grounds that the notes held by such noteholders were “non-recourse” notes. Below is a discussion of the court’s decision and its potential implications. The decision is currently being appealed.

The plaintiff, Horng Technical Enterprise Co., LTD (“Horng”), was a Taiwanese corporation that manufactured computer accessories.  Horng Technical Enterprise Co., LTD v. Sakar International, Inc., No. 10-3648 (3d Cir. June 23, 2011).  The defendant, Sakar International, Inc.