The U.S. Court of Appeals for the Eleventh Circuit recently affirmed the dismissal of a mortgage loan borrower’s federal Fair Debt Collection Practices Act and related state law claims because the defendant mortgagee was not a “debt collector” as defined by the FDCPA.
In so ruling, the Court also rejected the borrower’s allegations that the monthly statements the mortgagee sent to the borrower after her bankruptcy discharge were impermissible implied assertions of a right to collect against her personally.
(Bankr. W.D. Ky. July 28, 2017)
A recent decision of the Court of Appeals for the Seventh Circuit appears to have further raised the hurdle to equitably subordinate claims. Continuing what appears to be a move toward a narrower interpretation of equitable subordination, the Seventh Circuit held that misconduct alone does not provide sufficient justification to equitably subordinate a claim; injury to the interests of other creditors is required as well.
Sometimes the interpretation of the Bankruptcy Code leads to unexpected results. In a recent case, the US Bankruptcy Appellate Panel of the Ninth Circuit (BAP) has ruled that section 510(b) of the Bankruptcy Code requires the subordination of certain claims against a debtor to all equity interests in the debtor, even though such subordination may mean that the holders of the claims will receive nothing on the claims.
The Bottom Line:
Introduction
The Worker Adjustment and Retraining Notification Act (“WARN”) requires an employer to give 60 days’ advance written notice prior to a plant closing or mass layoff. Frequently, as a company encounters financial distress—a situation that often leads to a plant closing or mass layoff— creditors exercise greater control over the entity in an attempt to recover debts owed to them. When the faltering company fails to provide the requisite WARN notice, terminated employees often assert that WARN liability should attach to such creditors. In Coppola v. Bear, Stearns & Co.
January 8, 2008 A Delaware bankruptcy court decided on Friday that mortgage servicing rights could be severed from a mortgage loan repurchase agreement that fell within applicable safe harbors of the Bankruptcy Code, at least where the loans were transferred “servicing retained.” The decision isCalyon New York Branch v. American Home Mortgage Corp., et al. (In re American Home Mortgage Corp.), Bankr. Case No. 07-51704 (CSS) (Bankr. D. Del. Jan. 4, 2008).
On February 16, 2011, the United States Court of Appeals for the Third Circuit ruled that a discounted cash flow analysis constituted “a commercially reasonable determinant[] of value” for purposes of section 562(a) of the United States Bankruptcy Code.1 In so doing, the court upheld the United States Bankruptcy Court for the District of Delaware decision sustaining the objection of American Home Mortgage Holdings, Inc.
Just in time for the fifth anniversary of the enactment of chapter 15 of the Bankruptcy Code, which allows foreign debtors to administer assets located in the U.S. or stay the actions of U.S. creditors – Judge Martin Glenn of the Bankruptcy Court for the Southern District of New York has issued a decision reaffirming the broad utility and scope of chapter 15.