In In re Kohls, 2007 LEXIS 76 (Bankr NDWVa 2007), the debtor filed this adversary proceeding against the Bank to cancel indebtedness and recover damages related to a $34,864 loan that the Bank made to the Debtor on the grounds that the loan was unconscionable at the time it was executed in violation of W. Va. Code § 46A-2-121.
On May 5, 2010, the United States Bankruptcy Court for the Southern District of New York issued a decision declaring that a party’s right to setoff in an ISDA Master Agreement is unenforceable in bankruptcy unless strict mutuality exists. (Decision and Order).
A bankruptcy court recently held that in order for a supplier of goods on credit to establish an administrative claim under Bankruptcy Code section 503(b)(9) in the bankruptcy case of its buyer, the supplier will need to show that its buyer "physically" received the goods within 20 days prior to the buyer's bankruptcy filing, regardless of when title to the goods passed. In Re Circuit City Stores, Inc., et al., Case No. 08-35653, No. 7149 (Bankr. E.D. VA April 8, 2010).
On May 5, 2009, Judge James Peck, the Bankruptcy Judge in the Lehman Brothers bankruptcy cases, held that the safe harbor provisions of the Bankruptcy Code do not override the mutuality requirements for setoff under section 553(a) of the Bankruptcy Code. As a consequence, the Bankruptcy Court prohibited Swedbank, a non-debtor counter party to a swap agreement, from setting off pre-petition claims against Lehman against funds collected for Lehman’s account postpetition. See In re Lehman Bros. Holdings Inc., Bankr. Case No. 08-13555 (JMP) (Bankr. S.D.N.Y.
According to the U.S. Bankruptcy Court for the Southern District of New York, a lack of bad faith is no longer a defense to court sanctions for failure to produce documents in a timely manner. That court, in In re A&M Florida Properties II, recently awarded sanctions against both a party and its counsel for the counsel’s failure to become familiar with the client’s email and data-retention policies and systems— despite the absence of any bad faith or willful delay.1
The U.S. Bankruptcy Court for the Southern District of New York recently issued an opinion in the case of In re Lehman Brothers Holdings Inc. that significantly restricts the scope of setoff rights for energy traders and other participants in derivatives and forward commodity markets. Traditionally, bankruptcy law has required mutuality between the debtor and a creditor as a prerequisite for the exercise of setoff rights by the creditor.
Following an initial FINRA arbitration award holding Steven Singer liable to Hartford Financial Holdings for compensatory damages, Mr. Singer filed Chapter 7 bankruptcy. After a complicated procedural history, the Bankruptcy Court granted relief from the automatic stay and allowed Hartford to proceed with this action in US District Court for the Southern District of New York.
Introduction
On May 5th, the United States Bankruptcy Court for the Southern District of New York issued a decision declaring that a party's right to setoff in an International Swaps and Derivatives Association, Inc. ("ISDA") Master Agreement is unenforceable in bankruptcy unless "strict mutuality" exists.
In a recent decision, the United States Bankruptcy Court for the Southern District of New York distinguished excusable neglect in filing a claim before the expiration of a clear bar date. In a written opinion issued on May 20, 2010 in the case of In re Lehman Brothers Holdings, Inc., et. al, Case No. 08-13555 (JMP), Judge Peck denied seven motions for leave to file late claims finding none satisfied the Second Circuit’s strict standard to find excusable neglect.