Whether post-death creditor protection is available to inherited IRAs under the 2005 Bankruptcy Act has been the subject of a number of cases decided in the last several years. The argument made by bankruptcy trustees is that, on the death of the IRA owner, the IRA ceases to be “retirement funds” as it is not the retirement funds of the beneficiary. Consequently, the bankruptcy trustees argue that the inherited IRA ceases to have the protection afforded to IRAs under the Bankruptcy Code.
On April 16, 2012, the Supreme Court of the State of New York, Nassau County, entered an Order of Liquidation and Approval of the ELNY Restructuring Agreement (Order) and accompanying memorandum decision. The Order was entered over the objections of a number of ELNY payees, and followed an 11 day hearing that took place in March 2012.
Introduction
On April 19, 2012, the U.S. Bankruptcy Court for the Southern District of New York granted in part and denied in part JPMorgan Chase, N.A.’s motion to dismiss an adversary complaint filed by Lehman Brothers Holdings Inc. (“LBHI”) and its Official Committee of Unsecured Creditors. The Complaint seeks to recover approximately $8.6 billion in prepetition transfers made by LBHI to JPMorgan in the days leading up to LBHI’s bankruptcy.
Hawker Beechcraft, Inc., an airline manufacturer headquartered in Wichita, Kansas, filed a chapter 11 petition for reorganization under the federal bankruptcy code in New York City on Thursday, May 3, 2012. The announced purpose of the filing is to implement an agreed “comprehensive financial restructuring.” In essence, the agreement will convert all of the company’s secured bank and bond debt to equity.
On April 30th, the FDIC issued a final rule that treats a mutual insurance holding company as an insurance company for purposes of Section 203(e) of the Dodd-Frank Act. The new rule clarifies that the liquidation and rehabilitation of a covered financial company that is a mutual insurance holding company will be conducted in the same manner as an insurance company.
“In chapter 11, a creditor should be able to assert the full amount of any guarantee claim against the debtor without reducing the claim for recoveries against another obligor.”
“Whether the Nortel Senior Notes will be entitled to post-petition interest, and at what rate, in the chapter 11 cases are open questions that may hinge, among other things, on proving solvency of the Nortel chapter 11 debtors.”
Advances in production technology have led to an unprecedented supply of natural gas in the United States, putting downward pressure on market prices. Both the Henry Hub cash price and the NYMEX price closed below $2.00/MMBtu at times in the past month and prices continue to hover in the $2.00 range.
Those who were eagerly anticipating the final dénouement on May 15, 2012, in the epic battle between Madoff Trustee Irving Picard and the numerous defendants, constituting the Wilpon-Katz-Mets individual, business, family trust and charitable interests (collectively, the “Wilpons”), will apparently have to wait at least until May 31, 2012. The approval of the final Settlement Agreement by Federal District Judge Jed S. Rakoff, originally scheduled to occur at a hearing on May 15, 2012 at 4 p.m., has been postponed until May 31, 2012 at 4 p.m.
Section 541(a) of the Bankruptcy Code creates a worldwide estate comprising all of the legal or equitable interests of the debtor, “wherever located,” held by the debtor as of the filing date.1 The Bankruptcy Code’s automatic stay, in turn, applies “to all entities” and protects the debtor’s property and the bankruptcy court’s jurisdiction by barring “any act to obtain possession of property of the estate . . .