On Saturday, February 13, Antonin Scalia, Associate Justice of the United States Supreme Court, passed away. Although there has been no shortage of media coverage (and brouhaha regarding Justice Scalia’s successor and the process for appointing same), we at the Weil Bankruptcy Blog want to take a moment to pay our respects.
Last June, the Supreme Court issued a ruling in Baker Botts LLP v.
After a busy term last Spring that saw the United States Supreme Court issue decisions in Bank of America, N.A. v. Caulkett and Baker Botts v.
In a May 4, 2015 opinion1 , the United States Supreme Court held that a bankruptcy court order denying confirmation of a chapter 13 repayment plan is not a final order subject to immediate appeal. The Supreme Court found that, in contrast to an order confirming a plan or dismissing a case, an order denying confirmation of a plan neither alters the status quo nor fixes the rights and obligations of the parties. Although the decision arose in the context of a chapter 13 plan, it should apply with equal force to chapter 11 cases.
“Our basic point of reference when considering the award of attorney’s fees is the bedrock principle known as the American Rule: Each litigant pays his own attorney’s fees, win or lose, unless a statute or contract provides otherwise,” wrote Clarence Thomas for the majority in last month’s United States Supreme Court decision in Baker Botts L.L.P. et al. v. Asarco LLC, 2015 U.S. LEXIS 3920, 83 U.S.L.W. 4428 (June 15, 2015).
Two important and very different decisions regarding public pensions were recently issued by the Supreme Court of Illinois and the Supreme Court of New Jersey. These decisions are significant not only for the workers and taxpayers in these States, but also for the owners and insurers of municipal bonds issued in these States.
ILLINOIS
On June 1, 2015, the United States Supreme Court decided Bank of America v. Caulkett, No. 13-1421, together with Bank of America v. Toledo-Cardona, No. 14-163, holding unanimously that a Chapter 7 bankruptcy debtor cannot “strip off” a junior lien.
The Bankruptcy Code allows bankruptcy trustees, debtors in possession, and official committees to hire attorneys, accountants, and other professionals to assist them in carrying out their statutory duties, with their fees to be paid by the bankruptcy estate. However, to get paid, these professionals must obtain approval from the bankruptcy court. But what happens when someone objects to their fees? Can the professionals recover the fees they incur in defending their fee applications? The Supreme Court says no.
On June 15, 2015, the US Supreme Court ruled that a law firm could not recover fees it incurred in defending its own fee application.
THE ASARCO CASE
The case involved the copper company ASARCO LLC that filed for Chapter 11 protection in 2005 to deal with cash flow and environmental issues, among others.