On October 26, the Eastern District of Wisconsin issued a ruling dismissing a Fair Credit Reporting Act case. In Garland v. Marine Credit Union, the Court granted summary judgment in favor of the debt collector, holding the dispute was a legal issue such that the consumer could not establish a factual inaccuracy in the credit reporting.

On October 31, the Federal Reserve Board adopted two proposed rules that would tailor how certain aspects of the post-crisis bank regulatory framework, including certain capital and liquidity requirements and other prudential standards, apply to large U.S. banking organizations. One of the rules is to be issued jointly by the FDIC, Federal Reserve and OCC. The other was issued solely by the Federal Reserve.

On October 26, the U.S. District Court for the Eastern District of Wisconsin denied a plaintiff’s motion for summary judgment and instead entered judgement in favor of two creditors and two consumer reporting agencies (collectively, “defendants”), holding that the debtor failed to show a factual inaccuracy in the credit reporting of a debt.

Avago Technologies Wireless (USA) Manufacturing Inc. acquired PLX Technologies, Inc. for $6.50 per share in cash. After the $300 million merger closed, certain former PLX stockholders sued for damages, alleging that the PLX directors had breached their fiduciary breaches, aided and abetted by both Potomac Capital Partners II, L.P. (a hedge fund that is an activist stockholder and had three designees on the PLX board) and the PLX board’s financial advisor (the “Banker”).

Section 108(c) applies to extend a judgment lien pending termination of the automatic stay. State law grants a judgment creditor a lien on all the judgment debtor’s personal property when the creditor obtains from the court and serves on the judgment debtor an order for appearance and examination (ORAP) to discover assets. The lien, which is not publicly recorded, lasts for one year.

Demonstrating heightened enforcement efforts by some state regulators, Washington Attorney General Bob Ferguson filed suit against a pair of debt collection companies and their owner, asserting the defendants were operating without a license in violation of state law.

The lawsuit is only the latest example of state attorneys general (AGs) stepping in to fill the void as the Bureau of Consumer Financial Protection (CFPB) has slowed down its enforcement efforts.

What happened

On August 20, the U.S. Bankruptcy Court for the Central District of Illinois in In re I80 Equipment, LLC, No.17-81749, 2018 WL 4006294 (Bankr. C.D. Ill. Aug. 20, 2018) held that a secured party failed to perfect its security interest due to an insufficient description of the collateral listed in its UCC-1 financing statement. The financing statement failed to sufficiently describe the collateral because it referenced the definition of “collateral” in the underlying security agreement without attaching the security agreement to the financing statement.

Last week, Lehman Brothers Holdings Inc. (“LBHI”) filed two new motions in its ongoing Southern District of New York Bankruptcy Court litigation against approximately 130 loan originators and brokers: (1) an Omnibus Motion for Leave to File Third Amended Complaints Pursuant to Rule 7015 of the Federal Rules of Bankruptcy Procedure (“Motion for Leave to Amend Complaint”); and (2) a Motion for Leave to Amend and Extend the Scope of the Alternative Dispute Resolution Procedures Orders for Indemnification Claims of the Debtors against Mortgage Loan Sellers (“ADR Motion”).

R&I Alert

Restructuring & Insolvency News

October 2018, Issue 3

In This Issue:

• What happens to committee claims when a

case is converted from a chapter 11 case to

a chapter 7 case? 1

• Equitable mootness: alive and well in the

third circuit 1

• Buyer beware: anti-assignment clauses

enforceable under delaware law 2

• Bankruptcy court finds substantive consolidation

of non-debtors not an available remedy in

seventh circuit 3

• A creditor is allowed to be “selfish” when

HERE LIONS ROAM: CISG AS THE MEASURE OF A CLAIM'S

VALUE AND VALIDITY AND A DEBTOR'S

DISCHARGEABILITY

Amir Shachmurove*

INTRODUCTION ............................................ ..... 463

I. A COMEDY OF ERRORS .............. 468

II. RELEVANT BANKRUPTCY LAW: THE CODE AND THE RULES ............ 470

A. Code and Rules .......................... ......... 470

B. Determination of a Claim 's Validity and Value .............. 471

C. Temporary Valuation Pursuant to Rule 3018(a) .... ........ 475