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    Recent decisions on non-recourse carve-outs in CMBS loans
    2012-03-19

    Recent court decisions in the state of Michigan—Wells Fargo Bank, NA v. Cherryland Mall, ____ N.W.2d _____, 2011 WL 6785393 (Mich.App. 2011) (Cherryland) in the Michigan intermediate appellate court and 51382 Gratiot Avenue Holdings Inc. v. Chesterfield Development Company, 2011 U.S. Dist. LEXIS 142404 (E.D. Mi. Dec.

    Filed under:
    USA, Michigan, Banking, Insolvency & Restructuring, Litigation, Securitization & Structured Finance, Alston & Bird LLP, Surety, Debtor, Debt, Liability (financial accounting), Commercial mortgage-backed security, Wells Fargo
    Authors:
    Robert J. Sullivan
    Location:
    USA
    Firm:
    Alston & Bird LLP
    Five common 409A design errors: #4 No six-month delay for public company terminations
    2012-03-20

    Code Section 409A is, in part, a response to perceived deferred compensation abuses at companies like Enron and WorldCom. The story of Code Section 409A’s six month delay provision is inextricably tied to the Enron and WorldCom bankruptcies.

    Filed under:
    USA, Company & Commercial, Employee Benefits & Pensions, Insolvency & Restructuring, Tax, Bryan Cave Leighton Paisner (Bryan Cave), Public company, Bankruptcy, Deferred compensation, Internal Revenue Service (USA), Enron, Bitly
    Authors:
    Brian W. Berglund
    Location:
    USA
    Firm:
    Bryan Cave Leighton Paisner (Bryan Cave)
    Scanlan v. Eisenberg, et al., 2012 U.S. App. Lexis 1112 (January 20, 2012)
    2012-03-21

    Seventh Circuit reverses district court decision that discretionary beneficiary lacked standing to bring surcharge claim for $200 million in investment losses from investment concentration.

    Filed under:
    USA, Insolvency & Restructuring, Litigation, Private Client & Offshore Services, McGuireWoods LLP, Fiduciary, Beneficiary, Standing (law), Trustee, Seventh Circuit
    Authors:
    Dana G. Fitzsimons Jr , Michael H. Barker , Adam M. Damerow , Meghan L. Gehr , Justin F. Trent
    Location:
    USA
    Firm:
    McGuireWoods LLP
    Subcontractors take note - Appellate Division confirms that construction lender has no duty to subcontractor absent express promise to pay
    2012-03-21

    The New Jersey Appellate Division recently ruled in Vollers Excavating and Construction, Inc. v. Citizens Bank of Pennsylvania, Docket No.

    Filed under:
    USA, New Jersey, Banking, Construction, Insolvency & Restructuring, Litigation, Cole Schotz PC, Bankruptcy, General contractor, Subcontractor
    Authors:
    Peter James Herrigel
    Location:
    USA
    Firm:
    Cole Schotz PC
    Carlyle Investment Management LLC et al. v. Carlyle Capital Corporation Limited, 2011 U.S. Dist. Lexis 85710 (Delaware, August 4, 2011)
    2012-03-21

    Forum selection clause in an investment management agreement is valid and enforceable.

    Filed under:
    USA, Delaware, Insolvency & Restructuring, Litigation, McGuireWoods LLP, Breach of contract, Investment management, Unjust enrichment, Default (finance), Forum selection clause, Mortgage-backed security
    Authors:
    Dana G. Fitzsimons Jr , Adam M. Damerow , Michael H. Barker , Meghan L. Gehr , Justin F. Trent
    Location:
    USA
    Firm:
    McGuireWoods LLP
    Estate of Badii ex rel. Badii v. Metropolitan Hospice, Inc., C.A. No. 6192-VCP (Del. Ch. Mar. 12, 2012) (Parsons, V.C.)
    2012-03-12

    In this memorandum opinion, the Court of Chancery appointed a receiver for an insolvent corporation deadlocked over how to discharge a tax lien.

    Filed under:
    USA, Delaware, Insolvency & Restructuring, Litigation, Private Client & Offshore Services, Tax, Potter Anderson & Corroon LLP, Shareholder, Interest, Tax lien
    Location:
    USA
    Firm:
    Potter Anderson & Corroon LLP
    If you aren’t successful, can you still get the success fee?
    2012-03-15

    Yes, on the facts in the Chapter 11 proceedings involving Borders, the insolvent bookseller.

    Jefferies & Company, an investment bank, was retained by Borders to pursue reorganisation strategies, including a possible sale of the company’s assets as a going concern. The bank made considerable efforts in flogging the assets, which resulted in an offer from an interested party, but an actual sale of assets did not happen. Jefferies nevertheless claimed the liquidation fee under its agreement with Borders. The company’s creditors opposed this: no sale, no success fee.

    Filed under:
    USA, Banking, Insolvency & Restructuring, Litigation, Borden Ladner Gervais LLP, US District Court for the Southern District of New York
    Location:
    USA
    Firm:
    Borden Ladner Gervais LLP
    Sixth Circuit rules that United States lacks standing in case against bankruptcy trustees
    2012-03-13

    The Sixth Circuit in United States v. Carroll, Case No.

    Filed under:
    USA, Insolvency & Restructuring, Litigation, Tax, Squire Patton Boggs, Bankruptcy, Sixth Circuit
    Authors:
    Carlee H. Toth
    Location:
    USA
    Firm:
    Squire Patton Boggs
    New bankruptcy proof of claim rules take effect
    2012-03-14

    As seen in the Spring 2012 issue of West Virginia Banker.

    In the wake of the national attention directed towards residential mortgages in the last few years, certain revisions were made to the Federal Rules of Bankruptcy Procedure to address perceived deficiencies in bankruptcy proofs of claim. The rule changes were first proposed in 2009 by the Judicial Conference of the United States and became effective December 1, 2011.

    Filed under:
    USA, Banking, Insolvency & Restructuring, Dinsmore & Shohl LLP, Bankruptcy, Debtor, Mortgage loan, Power of attorney
    Authors:
    Michael R. Proctor
    Location:
    USA
    Firm:
    Dinsmore & Shohl LLP
    Ninth Circuit finds California arbitration law preempted
    2012-03-14

    Relying on the U.S. Supreme Court’s decision inAT&T Mobility LLC v. Concepcion, the Ninth Circuit Court of Appeals recently held that California’s rule against compulsory arbitration of claims for public injunctive relief was preempted by the Federal Arbitration Act (“FAA”). The Court also underscored the key points of an enforceable arbitration clause. Kilgore v. KeyBank (March 7, 2012).

    Case Background

    Filed under:
    USA, California, Arbitration & ADR, Banking, Insolvency & Restructuring, Litigation, Seyfarth Shaw LLP, Federal preemption, Injunction, Arbitration clause, Student loan, Federal Arbitration Act 1926 (USA), Ninth Circuit
    Location:
    USA
    Firm:
    Seyfarth Shaw LLP

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