In November of 2010, the trustee for the Circuit City Stores, Inc., liquidating trust filed more than 500 adversary proceedings against creditors seeking the recovery of alleged preferential payments. The extent of the trustee's success in recovering these payments will impact the overall distribution to creditors. Creditors in bankruptcy cases should be aware that preference litigation allows a trustee or debtor-in-possession to recover payments received by a creditor during the period immediately preceding the bankruptcy filing.

Those not familiar with the Federal Rules of Bankruptcy Procedure are often surprised to learn that service by mail is sufficient in a bankruptcy proceeding. Federal Rule of Bankruptcy Procedure 7004(b)(3) authorizes service on a corporation (foreign or domestic) within the United States by first class mail as follows:

The Board of Directors of the Federal Deposit Insurance Corporation, or FDIC, approved an interim final rule clarifying how the agency will treat certain creditor claims under the new orderly liquidation authority established under the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The Federal Deposit Insurance Corporation (FDIC) has announced that the agenda for its board meeting next Tuesday, January 18, 2011, will include discussion regarding a “Final Rule Implementing Certain Orderly Liquidation Authority Provisions of the Dodd-Frank Act.”

Title II of the Dodd-Frank Act establishes a receivership process by which the FDIC can engage in an orderly liquidation process to wind down the affairs of and liquidate the assets of certain failing financial companies that pose a significant risk to the financial stability of the United States.

On 18 January 2011, the Federal Deposit Insurance Corporation (“FDIC”) issued an interim final rule (the “Rule”) with request for comments regarding certain provisions of Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd- Frank Act”). Title II creates the Orderly Liquidation Authority (“OLA”), which is a mechanism under which “covered financial companies” can be liquidated in a uniform fashion rather than under inconsistent insolvency regimes.

On January 18, 2011, the Federal Deposit Insurance Corporation (“FDIC”) approved an interim final rule (“Interim Rule”), with request for comments, to implement certain provisions of Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”).

The Board of Directors of the Federal Deposit Insurance Corporation (FDIC) voted on December 18 to approve an interim final rule clarifying how the agency will treat certain creditor claims under the new orderly liquidation authority established under the Dodd-Frank Wall Street Reform and Consumer Protection Act.

In a recent decision, CML V, LLC v. Bax, et al., C.A. No 5373-VCL (Del. Ch. Nov. 3, 2010), the Delaware Court of Chancery held that, unlike Delaware corporations, creditors of an insolvent Delaware limited liability company cannot bring derivative actions against the members or managers of the company unless they specifically contract for such rights.

On February 7, 2011, in In re DBSD North America, Inc.,1 the Court of Appeals for the Second Circuit released its opinion joining the Third Circuit in condemning socalled “gifting plans,” thus deepening the perceived circuit split with the First Circuit which has been interpreted as approving of gifting plans. In so doing, the Second Circuit relied on the U.S. Supreme Court cases of Bank of Am. Nat’l Trust & Sav. Ass’n v. 203 N. LaSalle St. P’ship2 and Norwest Bank Worthington v.