While the American economy continues to grow at a tepid pace, the filing rate for both personal and business bankruptcies has slowed dramatically. As banks have cleared many, but certainly not all, of their problem loans and have curtailed lending activity, the main driver of small- and medium-business bankruptcies has slowed. However, like death and taxes, bankruptcy is not going to go away. The retail sector appears to be primed for the next wave in bankruptcy filings, and that means that vendors, suppliers, and other creditors should be prepared.
As of August 1st, the legal landscape for receiverships in the State of Minnesota will change dramatically. Receiverships have long been used a remedy for mortgage lenders to preserve commercial property in foreclosure, but a lack of clear guidance under Minnesota law has been problematic for all parties. The Minnesota State Bar Association convened a panel of experienced debtor creditor attorneys to create a new statutory framework, which was eventually passed by the Legislature and signed by the Governor this spring. The new receivership statute, codified under Minnesota St
Most people are familiar with the two most common forms of bankruptcy protection under the Bankruptcy Code – Chapter 7 liquidations and Chapter 11 reorganizations. But like individuals and companies, municipalities can also file for bankruptcy protection under Chapter 9 of the Bankruptcy Code. Now the city of Stockton, California has become the largest city to file for municipal bankruptcy protection following major municipal bankruptcy filings in Jackson County, Alabama and Harrisburg, Pennsylvania.
The United States Supreme Court accepted the petition for certiorari on the Seventh Circuit decision in RadLAX Gateway Hotel, LLC v. Amalgamated Bank on December 12, 2011 and arguments will likely be heard by the Court in April 2012. This case presents the Supreme Court with the important issue of whether secured lenders are entitled to submit a credit bid, a bid not requiring actual transfer of payment, at the sale of their collateral in the Bankruptcy Court.
Due to the economic crisis of the past few years, many large and medium-sized businesses were forced to file for bankruptcy protection. Now, many businesses are faced with letters from bankruptcy trustees, or worse, a summons where the trustee is seeking liability for a “preference.” Faced with these demands, many businesses are failing to defend themselves, and incurring unnecessary liability. But acting quickly can help protect you and your business and settle preference claims short of expensive litigation.
Heide v. Juve, (In re David L. Juve and Mona L. Juve), No. 11-6006, (8th Cir. BAP 09/16/2011) (Judges Schermer, Federman, and Nail).
No. 08-6038 (8th Cir. BAP 11/16/09)
No. 09-6024 (8th Cir. BAP 11/30/09)
No. 09-6063 (8th Cir. BAP 11/24/09)