Under section 363 of the Bankruptcy Code, a debtor is permitted to sell substantially all of its assets outside of a plan of reorganization. Over the past two decades, courts have increasingly liberalized the standards under which 363 sales are approved. A recent decision from the United States Court of Appeals for the Third Circuit,
When defending against an employee's claims, an initial step that every employer should take is to determine if the employee has filed a Chapter 7 Voluntary Petition for bankruptcy in the recent past. If an employee filed for bankruptcy and failed to identify his EEOC charge or potential claims against his employer as an asset of his bankruptcy estate, the employee might be barred from pursuing the claim against the employer.
The U.S. Court of Appeals for the Ninth Circuit, in a case of first impression, recently held that section 1328(f) of the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA), which bars so-called “Chapter 20” debtors from receiving a discharge at the conclusion of their Chapter 13 reorganization if they received a Chapter 7 discharge within four years of filing the petition for Chapter 13 relief, does not prevent a debtor from voiding a secured creditor’s lien under section 506(d) of the Bankruptcy Code.
A terminated officer of a corporate debtor, who bargained for “18 months of severance ( … $375,000 … ) to ensure that his firing not disrupt [the debtor’s] negotiations for $80 million” of financing gave the debtor “reasonably equivalent value,” held the U.S. Court of Appeals for the Tenth Circuit on Oct. 15, 2015. In re Adam Aircraft Industries, Inc., 2015 U.S. App. LEXIS 17930, at *27 (10th Cir. Oct. 15, 2015).
The U.S. Bankruptcy Court for the Middle District of Florida recently held that, at a minimum, “surrender” under Bankruptcy Code §§ 521 and 1325 means a debtor cannot take an overt act that impedes a secured creditor from foreclosing its interest in secured property.
In so holding, the Court found that actively contesting a post-bankruptcy foreclosure case is inconsistent with a “surrender” of the property.
So-called “red flags” were not “sufficient to impose a duty on [a gambling casino (‘Casino’)] to investigate” a Chapter 11 debtor’s pre-bankruptcy fraudulent transfers to its insiders who gambled at the Casino, held the U.S. Court of Appeals for the Seventh Circuit on Oct. 13, 2015. In re Equipment Acquisition Resources, Inc., 2015 WL 5936354, at *6 (7th Cir. Oct. 13, 2015).
Last week’s decision by the U. S. Court of Appeals for the Third Circuit in In re: Forever Green Athletic Fields, Inc., No. 14-3906 (3d Cir. Oct. 16, 2015) held that an involuntary bankruptcy petition filed under 11 U.S.C. § 303 may be dismissed for bad faith. The decision places another hurdle for creditors to surmount when considering whether to put a debtor in bankruptcy and creates another means for debtors to oppose such filings. It also enumerates the standard for evaluating whether a filing is in bad faith.
It is widely known that one of the basic tenets of U.S.
The Ninth Circuit has overruled its own relatively recent decision and has held that a debtor who sues for damages to redress a violation of the automatic stay may recover the reasonable fees it incurs prosecuting the action, even after the stay violation is cured.