Bankruptcy Court determines that TBA contracts do not qualify as customer claims

The United States Bankruptcy Court for the Southern District of New York issued a memorandum decision in the Lehman Brothers Inc. (LBI) liquidation proceeding confirming the LBI trustee’s determination that certain claims relating to TBA contracts do not qualify as customer claims against LBI’s estate.

Filed under:
USA, New York, Banking, Insolvency & Restructuring, Litigation, Securitization & Structured Finance, Katten Muchin Rosenman LLP, Mortgage-backed security, Lehman Brothers, United States bankruptcy court, US District Court for the Southern District of New York
Location:
USA
Firm:
Katten Muchin Rosenman LLP
Federal Deposit Insurance Corporation and Treasury Department issue proposed rules for calculation of maximum obligation limitation under Dodd-Frank

On Friday, November 25, 2011, the Federal Deposit Insurance Corporation (the “FDIC”) and the Department of the Treasury (“Treasury”) issued joint proposed rules to implement the requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Act”) described below.  Comments must be received by January 24, 2012.

Filed under:
USA, Banking, Capital Markets, Insolvency & Restructuring, Insurance, Williams Mullen, Federal Deposit Insurance Corporation (USA), US Department of the Treasury, Dodd-Frank Wall Street Reform and Consumer Protection Act 2010 (USA)
Authors:
Edmund "Ed" D. Harllee
Location:
USA
Firm:
Williams Mullen
Court finds defendants knowingly waived right to jury trial, affirms such waivers must be clear

Lehman Brothers Holdings, Inc. v. Bethany Holdings Group, LLC, et al., 2011 WL 3427013, (S.D.N.Y. Aug. 5, 2011)

CASE SNAPSHOT

Filed under:
USA, Banking, Insolvency & Restructuring, Litigation, Real Estate, Reed Smith LLP, Surety, Waiver, Jury trial, Default (finance), Lehman Brothers
Authors:
Kathleen A. Murphy
Location:
USA
Firm:
Reed Smith LLP
Strict compliance with Section 524(c) required to uphold reaffirmation contract

Sandburg Financial Corp. v. American Rice, Inc. (In the Matter of American Rice, Inc.), No. 11-40301 (5th Cir., Sept. 22, 2011)

CASE SNAPSHOT

Filed under:
USA, Insolvency & Restructuring, Litigation, Real Estate, Reed Smith LLP, Injunction, Debt, Fifth Circuit
Authors:
Joseph D. Filloy
Location:
USA
Firm:
Reed Smith LLP
Court finds material questions of fact regarding breach of fiduciary duties and deepening insolvency

Official Committee of Unsecured Creditors v. Baldwin (In re Lemington Home for the Aged), No. 10-4456 (3d Cir., Sept. 21, 2011)

CASE SNAPSHOT

Filed under:
USA, Insolvency & Restructuring, Litigation, Reed Smith LLP, Fiduciary, Board of directors
Location:
USA
Firm:
Reed Smith LLP
What Anna Nicole Smith’s bankruptcy case may mean to credit managers everywhere

In June 2011, the United States Supreme Court issued its opinion in the case known as Stern v. Marshall. The U.S. Supreme Court held that filing a proof of claim in a bankruptcy case does not constitute consent to the bankruptcy court’s jurisdiction over all counterclaims or actions that the bankruptcy estate may later bring against the creditor.

In fact, filing the proof of claim constitutes consent only to those claims or actions that either (1) stem from the bankruptcy case itself; or (2) are necessary to the resolution of the creditor’s proof of claim.  

Filed under:
USA, Insolvency & Restructuring, Litigation, Reed Smith LLP, Bankruptcy, Defamation, Supreme Court of the United States, United States bankruptcy court
Authors:
Robert P. Simons , Jeanne S. Lofgren
Location:
USA
Firm:
Reed Smith LLP
FDIC treatment of creditor claims under orderly liquidation process

When a traditional nonbanking company files a case under the Bankruptcy Code, a judge is appointed to be the neutral arbiter of disputes that arise between the debtor and its creditors.

Filed under:
USA, Banking, Insolvency & Restructuring, Litigation, Reed Smith LLP, Standard of review, Liquidation, Judicial review, Federal Deposit Insurance Corporation (USA), Financial Stability Oversight Council, Title 11 of the US Code
Authors:
Robert P. Simons , Luke A. Sizemore
Location:
USA
Firm:
Reed Smith LLP
Court upholds ipso facto clause and default interest rate

In re General Growth Props., Inc., Case No. 09-11977 (ALG), 2011 BL 189724 (Bankr. S.D.N.Y. July 20, 2011)  

CASE SNAPSHOT

Filed under:
USA, Banking, Insolvency & Restructuring, Litigation, Reed Smith LLP, Bankruptcy, Debtor, Interest, Default (finance)
Authors:
Jeanne S. Lofgren
Location:
USA
Firm:
Reed Smith LLP
Substantive consolidation order not automatically retroactive absent language to the contrary

Giuliano v. Shorenstein Company, LLC (In re Sunset Aviation, Inc.), Adv. No. 11- 50965, Bankr. No. 09-10778, 2011 WL 4002429 (Bankr. D. Del. Sept. 7, 2011)  

CASE SNAPSHOT

Filed under:
USA, Delaware, Insolvency & Restructuring, Litigation, Reed Smith LLP, Bankruptcy, Debtor, Limited liability company, Ex post facto law, United States bankruptcy court, Sixth Circuit, US District Court for District of Delaware
Authors:
Brian M. Schenker
Location:
USA
Firm:
Reed Smith LLP
In a case of first impression, court grants administrative priority status to post-petition withdrawal liability

In re Marcal Paper Mills, Inc., No. 09-4574, 650 F.3d 311 (3d Cir., 2011)

CASE SNAPSHOT

Filed under:
USA, Employee Benefits & Pensions, Insolvency & Restructuring, Litigation, Reed Smith LLP, Employee Retirement Income Security Act 1974 (USA), Defined benefit pension plan, Third Circuit
Authors:
Kathleen A. Murphy
Location:
USA
Firm:
Reed Smith LLP