Reprinted with permission from the March 18, 2011 issue of The Legal Intelligencer © 2010 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.
Over the last couple of years, the predominant goal in many business bankruptcy proceedings has been the sale of substantially all of the estate's assets. Such bankruptcy sales are often favored by buyers under Section 363(f), which enables a "free and clear" transfer of the assets.
There was good news on two fronts this week for direct broadcast satellite (DBS) operator DISH Network. On Sunday, DISH settled a retransmission dispute with LIN Media with the signing of a new carriage contract that restored to DISH subscribers LIN broadcast network signals that were cut off on March 5. That development was followed by a New York bankruptcy court’s decision on Tuesday to approve a revised agreement through which DISH would acquire the assets of bankrupt mobile satellite services (MSS) provider DBSD North America for $1.5 billion.
We reported to you last month a significant development in the matter of In re TOUSA USA, when the United States District Court for the Southern District of Florida issued its opinion and order reversing the controversial holdings of the Bankruptcy Court in the TOUSA chapter 11 case as to the so-called “Transeastern Lenders,” a group of lenders who had previously been ordered to disgorge nearly ½ billion dollars received in repayment of indebtedness which the Court found constituted a fraudulent transfer under Sections 548 and 550 of the Bankruptcy Code.
Now we can add Program Manager’s Technical Advice or “PMTA” to the list of administrative projects on tax matters that are open to FOIA and review by the tax practitioner community. One area that needs some help are investors in tenancy-in-common programs. On May 15, 2010, the Service issue PMTA 2010-05 which provides an legal analysis from Chief Counsel’s office directed to IRS program managers in the field.
In a previous Financial Services Flash, we brought to your attention the decision of the United States Bankruptcy Court for the Southern District of Florida (the “Bankruptcy Court”) in the case ofIn re Tousa. In a decision that raised serious concerns for lenders in the United States, Justice Olson held that the first and second ranking secured lenders of Tousa Inc. (“Tousa”) did not act in good faith and were grossly negligent in providing Tousa with a secured loan less than six months before Tousa filed for bankruptcy.
1 Loranger v Jones, 184 Cal App 4th 847 (3d Dist May 2010)
Jones, a licensed contractor, had a workers' compensation policy covering his employees. Jones unknowingly used an unlicensed subcontractor and knowingly permitted two minors without work permits, and another person without a contractor's license, to help perform work for Loranger. Loranger refused to pay the final invoice and Jones filed suit for breach of contract. Loranger cross-complained alleging defects and sought disgorgement of monies paid.
WHITELY v. MORAVEC (February 16, 2011)
3V Capital Master Fund LTD. v. Official Comm. of Unsecured Creditors of TOUSA, Inc. (In re TOUSA, Inc.), 2011 U.S. Dist. LEXIS 14019 (S.D. Fla. Feb. 11, 2011).
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.
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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