California has seen a string of three Chapter 9 filings this year and faces a long line of distressed municipalities. Given this backdrop, the California Public Employees’ Retirement System (“CalPERS”) figures to play a prominent role in the resolution of many of these situations (in or out of bankruptcy). Thus, the bond‑buying public will scrutinize closely any steps that CalPERS takes to protect its claims in the Bankruptcy Court.
In In re City of Vallejo,1 the United States Bankruptcy Court for the Eastern District of California held recently that the City of Vallejo has the authority to reject its collective bargaining agreements with the city’s firefighters and electrical workers as part of its chapter 9 bankruptcy proceeding without going through the process detailed in section 1113 of the Bankruptcy Code. The bankruptcy court determined that a municipality does not need to comply with the stringent requirements that corporations face when seeking to reject a collective bargaining agreement (a “CBA”).
On June 1, the California Department of Financial Protection and Innovation (DFPI) released an invitation for comment on the DFPI’s regulatory approach to crypto asset-related financial products and services, as well as the potential regulation of such products and services under the California Consumer Financial Protection Law (CCFPL).
On October 7, California Governor Gavin Newsome signed SB 616 into law. This new law, which goes into effect on September 1, 2020, includes changes to California law regarding garnishments.
On June 7, 2019, Judge Dennis Montali of the U.S. Bankruptcy Court of the Northern District of California San Francisco Division found that FERC’s finding that it had concurrent jurisdiction with the U.S. bankruptcy court over wholesale power agreements was “unenforceable in bankruptcy court and of no force on the parties before it.” Judge Montali further noted that if necessary, the U.S. bankruptcy court will “enjoin FERC from perpetuating its attempt to exercise power it wholly lacks.” At issue, on review by the bankruptcy court, was whether, pursuant to 28 U.S.C.
On May 1, 2019, FERC denied Pacific Gas and Electric Company’s (“PG&E”) requests for rehearing of two prior orders in which FERC held that it and the bankruptcy courts have concurrent jurisdiction to review and address the disposition of wholesale power contracts sought to be rejected through bankruptcy. FERC’s order comes as the PG&E bankruptcy proceedings in the United States Bankruptcy Court for the Northern District of California (“Bankruptcy Court”) remain ongoing.
“[T]he price received at a California tax sale” properly held under state law “conclusively establishes ‘reasonably equivalent value’ for purposes of” the Bankruptcy Code’s (“Code”) fraudulent transfer section (§ 548(a)(1)), held the U.S. Court of Appeals for the Ninth Circuit on Sept. 8, 2016. In re Tracht Gut LLC, 2016 WL4698300, at *1 (9th Cir. Sept. 8, 2016). Affirming the lower courts, the Ninth Circuit reasoned that “California tax sales have the same procedural safeguards as the California mortgage foreclosure sale” approved by the U.S. Supreme Court in BFP v.
Yesterday, the California Department of Financial Institutions closed United Commercial Bank, headquartered in San Francisco, California, and the FDIC was named as receiver.
On Friday, the California Department of Financial Institutions closed Affinity Bank, headquartered in Ventura California, and the FDIC was named as receiver. As receiver, the FDIC entered into a purchase and assumption agreement with Pacific Western Bank, headquartered in San Diego, California, to assume all of the deposits of Affinity Bank.
Yesterday, a federal judge preliminary approved a $125 million cash settlement for former shareholders of New Century Financial Corp. (“New Century”). New Century was the second largest subprime mortgage originator before it filed for bankruptcy in April 2007. In February 2008, Michael J.