Yesterday, many citizens all over the country voted for local and state leaders and proposed ballot measures in their districts. Social media was abuzz with uploaded photos of individuals donning “I voted” stickers, and timelines were flooded with status messages urging people to exercise their civic rights and vote. Nevertheless, there were also those that opted not to vote, and their respective reasons varied.
On August 15, 2014, the Judicial Conference Advisory Committee on Rules of Practice and Procedure published a preliminary draft of proposed amendments to the Federal Rules of Bankruptcy Procedure and Official Forms. If adopted, several of the amendments will have a noticeable effect on mortgagees.
A recent decision from the United States Bankruptcy Court for the Western District of Texas touched on two popular bankruptcy topics: notice requirements and the effect of a bankruptcy discharge on claims.
In recent years, second lien financings have increased in popularity. Senior creditors rely on intercreditor agreements to protect their interests by limiting the rights that junior lien holders would otherwise enjoy as secured creditors through either lien subordination, payment subordination, or both. Lien subordination requires the turnover to first lien creditors of proceeds of shared collateral until the first lien holders are paid in full.
A divided Third Circuit Court of Appeals panel has reversed a district court ruling dismissing a shareholder’s lawsuit against individuals and a liquidating trustee involved in the dissolution of a biotechnology company and the liquidation of its assets. Schmidt v. Skolas, No. 13-3750 (3d Cir., decided October 17, 2014).
Directors of an insolvent corporation face a host of difficult questions. Should they wind up operations or file for bankruptcy to preserve assets for creditors, or chart a riskier course that could lead the company back to profitability and possibly create value for shareholders? If they choose the riskier course and it fails, will the directors be potentially liable to creditors? The opinion issued by Vice Chancellor Laster of the Delaware Court of Chancery earlier this month in Quadrant Structured Products Co., Ltd. v. Vertin, C.A. No. 6990-VCL, slip op., 2014 Del. Ch.
The rate of bankruptcies among construction industry participants is higher than some think. The bankruptcy of a developer creates an “automatic stay” under federal law preventing almost all collection activities, including actions to perfect a lien.
Remember when I wrote a glowing column about a Master Development and Supply Agreement Apple and its lawyers drafted? It was one of the most-read posts I’ve written, so I bet a good number of you do. Since the post was so popular, and since there have been some, well, we’ll say “unanticipated consequences” for Apple, I thought it warranted some follow up.
In Quadrant Structured Products Co. v. Vertin, C.A. No. 6990-VCL, 2014 Del. Ch. LEXIS 193 (Del. Ch. Oct. 1, 2014), the Delaware Court of Chancery held that when creditors of insolvent firms assert derivative claims, they need not meet the contemporaneous ownership requirement applied to stockholder-plaintiffs.
On October 16, 2014, the United States Court of Appeals for the Fifth Circuit entered an order requiring a real estate lender, First National Bank (the “Lender”), to refund certain mortgage payments it received from Protective Health Management (the “Debtor”), an affiliate of its borrower.1 Because the mortgage payments constituted actual fraudulent transfers, the Fifth Circuit held that the Lender could retain the payments only to the extent of the value of the Debtor’s continued use of the property.2&