Los Angeles Lawyer July/August 2018
BANKING, LENDING, AND INSOLVENCY RESTRICTIONS RELEGATE THE LEGITIMATE CANNABIS INDUSTRY IN CALIFORNIA TO AN ALL-CASH BUSINESS, VULNERABLE TO CRIME
The Court of Appeals for the Ninth Circuit revived a chapter 13 debtor’s bankruptcy case holding that the bankruptcy court below made no specific finding that the debtor violated the Controlled Substance Act (“CSA”) to support dismissal of the case.
On February 12, following a four-day trial, the U.S.
On March 22, 2017, the Supreme Court decided Czyzewski v. Jevic Holding Corp., holding that a bankruptcy court may not approve a structured dismissal of a Chapter 11 bankruptcy case if the order does not comply with the priority rules of the Bankruptcy Code. 580 U.S. __ (2017).
Last week, the DOJ sent a letter to trustees who handle consumer bankruptcy reminding them that marijuana is a federally illegal drug and warned them not to handle any money from the sale of marijuana-related property.
On July 14, 2016, the US Department of Justice (DOJ) announced that the restructuring of a planned $1.5 billion transaction between Tullett Prebon Group Ltd. (Tullett Prebon) and ICAP plc adequately addresses the DOJ’s concerns that the transaction would violate Section 8 of the Clayton Act by creating an interlocking directorate. The parties restructured their transaction after the DOJ issued a Second Request to adequately investigate the parties post-closing ownership structure.
Last week the Supreme Court exercised its option to do nothing about a Seventh Circuit decision allowing the federal government to cram a $150 million remediation obligation onto a chapter 11 successor corporation – all because the feds chose to proceed under RCRA (the federal hazardous waste statute) rather than CERCLA (the Superfund cleanup statute). Smart tactics by the feds.
The Slippery Slope to Fraud
In this detailed and insightful report, the Center for Audit Quality details how financial-accounting fraud can sometimes creep up on a company that would never have expected to become so embroiled in it.
Big, Broad Bankruptcy Bill
The U.S. Bankruptcy Code provides for the appointment of a bankruptcy examiner to investigate the debtor with respect to allegations of fraud, dishonesty, incompetence, misconduct or mismanagement. The right examiner, with a clearly defined mission, will have a major influence on the bankruptcy process. The difference between a successful financial restructuring or liquidation-resulting in substantial recoveries for the key constituencies-and a time-consuming (and asset-consuming) meltdown, can depend on the approach of the examiner and the examiner's support team.
In our June 4, 2009 Client Update, we reported on the jury verdict the Securities and Exchange Commission ("SEC") obtained against Charles Conaway, the former CEO of Kmart Corp for misleading investors about inventory and liquidity levels as the company was approaching its January 2002 Chapter 11 bankruptcy filing.