Summary
On June 9, 2014, in Executive Benefits Ins. Agency v. Arkison, the United States Supreme Court ruled that, pursuant to 28 U.S.C. § 157(c)(1), a bankruptcy court may make proposed findings of fact and conclusions of law in a Stern “core” proceeding subject to de novo review by an Article III court. To read the full decision, click here.
Facts
A unanimous Supreme Court, in Executive Benefits Ins. Agency, Inc. v. Arkinson (In re Bellingham Ins. Agency, Inc.), 573 U.S. ___ (2014), confirmed a bankruptcy court’s power to submit proposed findings of fact and conclusions of law for the district court’s de novo review, even though such court is constitutionally barred from entering a final judgment on a bankruptcy-related claim under Stern v. Marshall.
The case of Executive Benefits Insurance Agency v. Arkison (In re Bellingham Ins. Agency), No. 12- 1200, was easily one of the most closely watched bankruptcy cases in many years. Last week’s decision in that case, however, was far less dramatic than some practitioners feared it might be. The Supreme Court answered two important questions regarding the power of bankruptcy courts that it left open three years ago in Stern v. Marshall.
On June 9, 2014, in Executive Benefits Insurance Agency v. Arkison (In re Bellingham Insurance Agency, Inc.),1 a much-anticipated decision, the Supreme Court addressed how bankruptcy courts should adjudicate so-called Stern claims. Stern claims are “core” claims over which bankruptcy courts have statutory authority to enter orders and judgments,2 but which authority the Supreme Court previously held in Stern v. Marshall3 was not permitted (at least with respect to certain issues) under Article III of the United States Constitution.
On June 9, 2014, the Supreme Court issued a decision in Executive Benefits Insurance Agency v. Arkison, a case that tested the extent of the jurisdiction of bankruptcy court judges to decide fraudulent transfer and certain other claims against non-debtors. Ropes & Gray LLP represented the petitioner in obtaining certiorari and in the Supreme Court proceedings.
On August 31, 2012, the United States Court of Appeals for the Second Circuit published its first decision expressly adopting an abuse of discretion standard for reviewing equitable mootness determinations by district courts. In In re Charter Communications, Inc., the Second Circuit followed the Third and Tenth Circuits, while also reaffirming the Second Circuit’s rebuttable presumption of equitable mootness upon substantial consummation of a debtor’s plan.
In a recent decision, Senior Transeastern Lenders v. Official Comm. of Unsecured Creditors (In re TOUSA, Inc.), 2012 US App. LEXIS 9796 (11th Cir. May 15, 2012), the 11th Circuit Court of Appeals overturned a district court decision which had forcefully quashed a bankruptcy court decision to avoid, as a fraudulent transfer, a $400 million settlement and loan repayment by a parent company to a group of lenders (the “Transeastern lenders”).
When a traditional nonbanking company files a case under the Bankruptcy Code, a judge is appointed to be the neutral arbiter of disputes that arise between the debtor and its creditors.
In a decision likely to affect thousands of Madoff investors, the Second Circuit Court of Appeals on Aug. 16, 2011 unanimously upheld the method used by the liquidating trustee for Bernard L.
Fifth Circuit Court of Appeals: Insured Can Recover Damages for Mental Anguish under Louisiana Bad Faith Statute Where Insurer Acted in Bad Faith by Delaying Payments
January 9, 2009 | Print this page