Cryptocurrencies like bitcoin have been touted as everything from a tool that will revolutionize commerce to “the very worst of speculative capitalism.”[1] Less attention has been given to their practical application vis-à-vis commercial and insolvency law.

The Eight Circuit Court of Appeals recently weighed in on the extent to which a debtor must search for “known” creditors in order to provide sufficient notice of its bankruptcy and satisfy due process. In Dahlin v. Lyondell Chemical Co., ___ F.3d ___ (8th Cir. Jan. 26, 2018), the Eighth Circuit determined that a “known” creditor is one that is reasonably ascertainable, and a debtor need not perform more than one reasonably diligent search to unveil the identity of “known” creditors.

In Dahlin v. Lyondell Chemical Co., 2018 U.S. App. LEXIS 1956 (8th Cir. Jan. 26, 2018), the Eighth Circuit Court of Appeals rejected an argument that bankruptcy debtors were required by due process to provide more prominent notice of a case filing than they did, such that the notice might have been seen by unknown creditors with claims to assert.

SUMMARY

The Ninth Circuit recently limited the availability of diversity jurisdiction for certain cases with claims involving mortgage loan modifications. Specifically, in Corral v. Select Portfolio Servicing, Inc., the Ninth Circuit held that, where the plaintiff-borrower “seeks only a temporary stay of foreclosure pending review of a loan modification application … the value of the property or amount of indebtedness are not the amounts in controversy.” — F.3d —-, 2017 WL 6601872, at *1 (9th Cir. Dec. 27, 2017).

The Appellate Court of Illinois, First District, recently dismissed a mortgagee’s “breach of mortgage contract” action as an impermissible second refiling following prior voluntary dismissals of a 2011 foreclosure complaint and 2013 action for breach of the promissory note based upon the same note and mortgage.

Experience teaches that not every loan recipient will repay the lender in a timely fashion. Lenders commonly make use of third-party collection agencies when a loan falls significantly into arrears. In light of a recent decision by the 9th Circuit Bankruptcy Appellate Panel, however, it is more critical than ever for lenders to be cognizant of the letter of the law when it comes to interacting with a debtor who has filed for bankruptcy or received a discharge of debt in a bankruptcy case.

In this post, we return to cross-border insolvencies and examine one of the first decisions issued in 2018 by a bankruptcy court in a chapter 15 case: In re Energy Coal S.P.A., No. 15-12048 (LSS), 2018 Bankr. LEXIS 10 (Bankr. D. Del. Jan.

Adding to the growing split of authority among California’s various state appellate courts, and among various federal courts in California, the Court of Appeal of the State of California, Third Appellate District, recently held that a loan servicer may owe a duty of care to a borrower through application of the “Biakanja” factors, even though its involvement in the loan does not exceed its conventional role.

The U.S. Court of Appeals for the Ninth Circuit recently held that the trial court did not have subject matter jurisdiction based upon diversity over claims which sought a temporary stay of a foreclosure sale pending the review of a loan modification application because the amount of controversy did not exceed $75,000.

In so ruling, the Court held that, for claims which merely seek a temporary stay of a foreclosure sale, the amount in controversy is not the value of the underlying loan.