(B.A.P. 6th Cir. Nov. 28, 2017)

The Sixth Circuit B.A.P. affirms the bankruptcy court’s dismissal of the Chapter 12 bankruptcy case. The court finds that the bankruptcy court failed to give the debtor proper notice and opportunity to be heard prior to the dismissal. However, the violation of due process was harmless error. The delay in filing a confirmable plan and continuing loss to the estate warranted the dismissal. Opinion below.

Judge: Preston

Attorney for Appellant: Heather McKeever

(Bankr. S.D. Ind. July 29, 2016)

The bankruptcy court denies the debtor’s motion to transfer venue of his chapter 7 bankruptcy case from the Terra Haute Division to the Evansville Division. The debtor failed to satisfy the standard set forth in 28 U.S.C. § 1412 for venue transfer. The debtor’s travel time to each court location was virtually the same, and thus Evansville was no more convenient than Terra Haute. Further, there was no showing that the interests of justice would be better served by the transfer. Opinion below.

Judge: Graham

(Bankr. S.D. Ind. April 11, 2016)

(Bankr. E.D. Ky. Feb. 12, 2016)

(E.D. Ky. Oct. 3, 2017)

The district court affirms the bankruptcy court’s interpretation of a final cash collateral order, holding the bankruptcy court did not abuse its discretion in finding a carve-out for payment of professional fees included prepetition collateral of the lenders. The text of the order along with a review of the case record made clear that the parties had agreed the prepetition collateral was included. $2.4 million in fees were awarded. Opinion below.

Judge: Wilhoit

(7th Cir. July 27, 2016)

The Seventh Circuit affirms the bankruptcy court’s order finding that the debtor’s prepetition transfer of a farm to the defendant was a fraudulent transfer subject to avoidance. The debtor transferred the farm in exchange for the defendant’s agreement to abandon litigation he had brought against the debtor. The bankruptcy court found that the debtor did not receive reasonably equivalent value in exchange for the farm. Opinion below.

Per Curiam

Defendant: Pro Se

Attorney for Trustee: Brenda L. Zeddun

(Bankr. S.D. Ind. Apr. 8, 2016)

The bankruptcy court addresses whether certain tax penalty claims are dischargeable. The court finds certain penalties are dischargeable because they arose out of tax returns filed outside the three-year window provided in 11 U.S.C. § 523(a)(7). However, other penalties were not dischargeable because they arose out of a tax return filed within the three-year window. Opinion below.

Judge: Carr

Attorney for Debtors: Camden & Meridew, P.C., Julie A. Camden

(6th Cir. B.A.P. Jan. 28, 2016)

A senior creditor can obtain significant leverage over a chapter 11 debtor if it is able to vote not only its claim but the claims of junior creditors in connection with the solicitation of a plan of reorganization. Obtaining such leverage, however, has proven problematic in the past. Among other things, courts have been reluctant to enforce pre-bankruptcy assignments or waivers of voting rights contained in intercreditor agreements, holding that such assignments or waivers may violate the Bankruptcy Code and rules. In Avondale Gateway Center Entitlement, LLC v.

Directors and officers of troubled companies are already keenly cognizant of their potential liability for any breaches of fiduciary duty, negligence and fraud.