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
“The right of setoff … allows entities to apply their mutual debts against each other to avoid the pointless exercise of ‘making A pay B when B owes A.’” held the Seventh Circuit on Aug. 17, 2018. Berg v. Social Security Administration, 900 F.3d 864, 868 (7th Cir. 2018). But the Bankruptcy Code (“Code”) limits “a creditor’s right of setoff during the ninety-day period prior to the” date of bankruptcy, said the court. Id.
Amid the explosion of trading in claims against distressed and bankrupt entities, courts in recent years have issued numerous rulings of interest to both buyers and sellers.
In a recent decision enforcing the discharge injunction under Section 1107(d)(1)(A) of the Bankruptcy Code, the Bankruptcy Court for the Western District of Pennsylvania blocked a creditor from asserting a claim against the debtor after confirmation of the plan. The case of In re Trustees of Conneaut Lake Park, Inc.), No. 14-11277, 2018 Bankr. LEXIS 1447 (JAD) (Bankr. W.D. Pa.
View original on Law360: https://www.law360.com/articles/1088680/ucc-incorporation-by-reference-an-imperfect-way-to-perfect
Although the Federal Priority Act[1] has been deemed to be “almost as old as the Constitution”
In In re Houston Regional Sports Network, L.P., 886 F.3d 523 (5th Cir. 2018), the U.S. Court of Appeals for the Fifth Circuit held that bankruptcy courts have flexibility in selecting the date on which to value collateral, "so long as the bankruptcy court takes into account the purpose of the valuation and the proposed use or disposition of the collateral at issue." In so holding, the Fifth Circuit rejected the proposition that a bankruptcy court must value collateral as of either the bankruptcy petition date or the effective date of a cramdown chapter 11 plan.