A few weeks ago, the Sixth Circuit affirmed the Western District Court of Michigan’s holding in U.S. v. Quality Stores Inc., 424 B.R. 237 (W.D. Mich. 2010), that severance payments made to employees pursuant to an involuntary reduction in force were not “wages” for Federal Insurance Contribution Act (“FICA”) tax purposes. U.S. v. Quality Stores Inc., No. 10-1563 (6th Cir. 2012). The Sixth Circuit’s decision creates a circuit court split with the Federal Circuit and its 2008 decision in CSX Corporation v. United States, 518 F.3d 1328 (Fed. Cir. 2008).

This article is Part Seven in a seven-part series on how to structure sales and what to do when your customer fails to pay.

On August 2, 2012, the United States Court of Appeals for the Fifth Circuit held that a requirements contract for electricity is a forward contract for purposes of section 546(e) of the Bankruptcy Code and, therefore, settlement payments made under the contract are exempt from avoidance as preferences. Claude Lightfoot v.

The Perishable Agricultural Commodities Act of 1930 (“PACA”)¹ is deservedly renowned for its provisions creating a statutory trust on sold perishable commodities, and the products and revenues thereof. See 7 U.S.C. §499e. The PACA statutory trust can have dramatic consequences in the cases of bankrupt produce buyers; produce sellers often are paid in full, ahead of secured creditors holding liens on all inventory and accounts receivable. That is a story often told.

Summary

During an American Bar Association (ABA) program on antitrust and health care issues on October 1, 2012, U.S. Federal Trade Commission (FTC) Deputy Director for Health Care and Antitrust, Leemore Dafny, said that the FTC will focus on how patients purportedly react to price increases, as measured by "diversion ratios," when deciding which hospital mergers to investigate further for potential anticompetitive effects. 

When being sued, corporate and individual defendants should always confirm that the plaintiff has not been previously discharged in bankruptcy and failed to disclose the claim in the proceeding as an asset of the bankruptcy estate. In Guay v. Burack, 677 F.3d 10 (1st Cir. 2012), the plaintiff brought numerous claims against various governmental entities, governmental officials and a police officer.

Settlement of collection disputes over amounts and payment terms for bond-related claims, including in bankruptcy cases, involves issues of binding minority bondholders and releasing the indenture trustee, as well as straightforward determinations of collectability economics.   Bondholders unhappy with a proposed settlement can be bound nevertheless when the deal is incorporated into a bankruptcy plan of reorganization and majority bondholders out-vote them, but only if certain requirements are met.  A recent bankruptcy court decision, In re Lower Bucks Hosp., 471 B.R.

The Eighth Circuit Court of Appeals recently held in Lewis Brothers Bakeries Incorporated and Chicago Baking Company v. Interstate Brands Corporation (In re Interstate Bakeries Corporation), 690 F.3d 1069 (8th Cir. Aug.

In Shelton v. CitiMortgage, Inc. (In re Shelton), --- B.R. --- (B.A.P. 8th Cir. Sept. 24, 2012), the Bankruptcy Appellate Panel for the Eighth Circuit Court of Appeals determined that a secured creditor’s lien cannot be avoided simply because the creditor’s claim was disallowed as being filed after the proof of claim bar date.