In a second decision of the United States District Court for the Southern District of Florida involving secured lenders to bankrupt homebuilder TOUSA, Inc., on March 4, 2011, Judge Adalberto Jordan affirmed the dismissal of fraudulent conveyance claims brought against the lenders on a revolving credit facility. In dismissing those claims, the Bankruptcy Court had emphasized that, because the revolving credit agreement was entered into, and the liens securing it were pledged, well before the company's alleged insolvency, they were immune from fraudulent conveyance attack.

The Board of Directors of the Federal Deposit Insurance Corporation, or FDIC, approved a Notice of Proposed Rulemaking, or NPR, to further clarify application of the orderly liquidation authority, or OLA, contained in Title II of the Dodd-Frank Act. The FDIC believes the NPR builds on the interim rule approved by the FDIC on January 18, 2011, which clarified certain discrete issues under the OLA.

The Executive Office of the United States Trustee, part of the Department of Justice, has embarked on an initiative to investigate bankruptcy-related practices of the major mortgage servicers. The United States Trustees have not identified any authority to conduct an investigation beyond specific matters pertaining to individual debtors or their estates.

A new bill introduced in California would prohibit debt settlement providers from charging any fees in excess of 15% of the amount of consumers’ savings as a result of any settlement.

The Debt Settlement Consumer Act (Senate Bill 708) was introduced in February 2011 by State Senator Ellen Corbett (R-San Mateo), who headed the California Senate Judiciary Committee that stopped a proposed regulation (Assembly Bill 350) last year that had drawn support from the debt settlement industry. The bill is supported by the Center For Responsible Lending and the Consumers Union.

FDIC Proposes Rules for the Recoupment of Compensation from Executives of Failed Financial Institutions I hope this does not apply to any of you, but on Tuesday, the Board of Directors of the Federal Deposit Insurance Corporation (FDIC) approved a Notice of Proposed Rulemaking (NPR) to clarify application of the orderly liquidation authority contained in Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act, "Orderly Liquidation Authority" (OLA).

In re TOUSA, Inc., Nos. 10-60017-CIV/Gold, 10- 61478, 10-62032, 10-62035, and 10-62037 Slip Op. (S.D. Fla. Feb. 11, 2011)

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On March 15th, the FDIC published for comment a proposed rule that would establish the priority of payments to creditors when the FDIC acts as liquidator for a failed non-bank financial institution. The proposal also would establish the procedures for filing a claim with the receiver and clarifies the receiver's clawback authority. Comments should be submitted within 60 days after publication in the Federal Register, which is expected during the week of March 21.

In its continued effort to implement its authority to resolve “covered financial companies” under Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), on March 15, 2011, the Board of Directors of the Federal Depository Insurance Corporation (the “FDIC”) approved the Notice of Proposed Rulemaking Implementing Certain Orderly Liquidation Authority Provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Proposed Rules”).

On March 15, 2011, the Federal Deposit Insurance Corporation (“FDIC”) issued a notice of proposed rulemaking (“NPR”) to implement certain orderly liquidation authority (“OLA”) provisions of Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”).

In re Buttermilk Towne Center, LLC, No. 10-8036, 2010 Bankr. LEXIS 4563 (B.A.P. 6th Cir. Dec. 23, 2010)

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