United States Bankruptcy Court, D. Maryland. March 02, 2020
The plaintiffs were various entities who filed for bankruptcy protection under Chapter 11 in 2001. Their bankruptcy confirmation order set a bar date for the filing of claims by creditors against the entities. Nearly 16 years later, asbestos claimants filed claims for exposure to asbestos in Pennsylvania. The plaintiffs then filed suit against the asbestos claimants as an adversarial bankruptcy proceeding. Motions for summary judgment were filed by both sides.
Bankruptcy and class actions each establish elaborate procedures and provide a convenient forum to resolve numerous claims against one or more defendants, in an efficient manner. However, while a class action focuses on providing adequate representation to claimants with similar claims, bankruptcy focuses on enabling an insolvent company to reorganize. The two goals do not necessarily blend well in every circumstance.
The importance of clarity in drafting agreements can never be understated. And while there are strategies available to spouses of business owners to help protect a family in bankruptcy, it is imperative to properly plan and draft to receive such protection from the Courts. In re Somerset Regional Water Resources, LLC, _____________ F.3d ________________ (3rd Cir. 2020) (“Somerset”), recently decided by the Third Circuit Court of Appeals, offers a prime example of both cautionary concepts.
Hunt (as Liquidator of Systems Building Services Group Limited) v Michie and Others [2020] EWHC 54 (Ch)
On 21 January 2020 ICC Judge Barber handed down a decision which considered, in what is believed to be a first, the question of whether director’s duties survive the insolvency of a Company.
The U.S. Court of Appeals for the Ninth Circuit recently rejected a loan servicer’s appeal from a Bankruptcy Appellate Panel’s ruling to remand to the lower bankruptcy court a punitive damages award for alleged discharge violations.
In so ruling, the Court held that it lacked appellate jurisdiction regarding the Bankruptcy Appellate Panel’s ruling as to the punitive damages award, but affirmed the Bankruptcy Appellate Panel’s denial of the debtors’ motion for appellate attorney’s fees.
This question — how the Coronavirus will impact Chapter 11 cases going forward — is still to be determined, but this author believes it may turn the Chapter 11 process into what it was originally intended to be, a reorganization.
The dower statutes in Kentucky present challenges when deciding what parties to name in a foreclosure complaint. When dower issues arise, title claims might be necessary, which means foreclosures can be delayed and court costs can increase.
Dower is a somewhat complex right given to protect spouses who are not listed as titleholders on the deed for their homestead. Dower rights in English law date back to the Magna Carta, when widows were granted some protection from the economic hardships that occurred when their title-holding husbands died.
On February 25, 2020, in Rodriguez v. FDIC,1 the U.S. Supreme Court unanimously rejected the application of the so-called “Bob Richards” rule, a judicial doctrine that was developed in the context of a bankruptcy case almost 60 years ago concerning ownership of tax refunds secured by the parent corporate entity on behalf of a bankrupt subsidiary included in a consolidated group tax return.
On February 25, 2020, in Rodriguez v. Federal Deposit Insurance Corporation, No. 18-1269 (U.S. 2020), the U.S. Supreme Court effectively ruled that the so-called “Bob Richards rule” should not be used to determine which member of a group of corporations filing a consolidated federal income tax return is entitled to a federal income tax refund.
On February 25, 2020, the United States Supreme Court in Rodriguez v. Federal Deposit Insurance Corporation[1] struck down a judicial federal common law rule—known as the Bob Richards rule—that is used by courts to allocate tax refunds among members of a corporate affiliated group where the group does not have a written tax sharing agreement in place, or, at least in some federal Circuits, where an agreement fails to allocate the refunds unambiguously.