Ring v. First Niagara Bank, N.A. (In re Sterling United, Inc.), 519 B.R. 586 (Bankr. W.D.N.Y. 2014) –
A chapter 7 trustee sought to recover as preferences payments made by the debtor to a lender and proceeds of collateral liquidation received by the lender based on arguments regarding whether UCC financing statements adequately perfected the lender’s security interests.
A recent decision by the United States Bankruptcy Court for the Western District of Missouri held that a manufactured home is real property for purposes of Section 1322(b)(2) of the Bankruptcy Code. This holding prevents chapter 13 debtors from modifying a secured lender’s claim where the claim is secured by a lien on a manufactured home in Missouri that is the debtor’s primary residence.
Baker Botts L.L.P. et al. v. ASARCO L.L.C., currently pending before the Supreme Court of the United States, is of particular interest to bankruptcy practitioners because this decision will have far-reaching effects regarding attorney’s fees in bankruptcy. Specifically, the Supreme Court will determine whether Section 330(a) of the Bankruptcy Code grants bankruptcy judges the discretion to award compensation for the defense of fee applications.
In a recent decision by the Second Circuit, Lucas v. Dynegy Inc. (In re Dynegy, Inc.), No. 13-2581 (2d. Cir. Oct.
In re Killmer, 513 B.R. 41 (Bankr. S.D.N.Y. 2014) –
After reopening a bankruptcy case, a mortgagee moved for a determination that a post-petition delinquent property tax sale was void because it was held in violation of the automatic stay. In response, the tax authority requested retroactive annulment of the stay.
The bankruptcy of fractional-share operator Avantair triggered a dispute regarding exactly what property its fractional-share owners held. Like other fractional-share operators, Avantair operated a fleet of airplanes, selling fractional shares in each of them to individual participants. Using Fractional Share Contracts consisting of interlocking purchase agreements, dry lease agreements, and fractional use agreements, Avantair controlled, operated, and maintained a fleet of aircraft owned by its participants.
A recent decision by a New Jersey bankruptcy court scrambles the law regarding rejected trademark licenses.1 Crumbs was a multi-location bakery that also licensed its trademarks and trade secrets to third parties. In July of 2014 Crumbs filed a Chapter 11 reorganization case and in August of 2014 the court entered an order selling substantially all of the assets of Crumbs to LFAC2 free and clear of liens, claims, encumbrances, and interests.
As noted in Part 1 of this series, any buyer of assets from a company in any degree of financial stress should be concerned about the transaction being attacked as a fraudulent transfer. Officers and directors of a selling entity also have concerns about this risk due to potential personal liability.
“Each player must accept the cards life deals him or her: but once they are in hand, he or she alone must decide how to play the cards in order to win the game.” – Voltaire