Stay up to date with important news, special announcements, and resources to help you along the way.
New Working Paper Raises Significant Concerns Regarding “Bankruptcy Directors” in Chapter 11 Cases
Bankruptcy practitioners have been anecdotally aware of the increased presence of so-called “bankruptcy directors” in Chapter 11 cases over the last decade. Three academics, however, recently released a seminal working paper containing the first empirical study on the effect such directors have in Chapter 11 cases.
Jevic: It’s Back for the Bankruptcy Attorney Business
The landmark commercial bankruptcy case Czyzewski v. Jevic Holding Corp. (2017), as originally filed in 2008, made bankruptcy case law by holding that a structured Chapter 11 settlement may not include distribution to creditors in violation of the priorities in Section 507(a):
The Tricky Evolution of Personal Jurisdiction
While a defendant in a bankruptcy case cannot waive subject matter jurisdiction, a different set of rules apply in personal jurisdiction. Reynolds v. Behrman lays out some of the groundwork for understanding how these rules apply, offering crucial insight for a bankruptcy attorney or CPA.
Bankruptcy Judge Weighs in on Questionable Second Circuit Safe Harbor Ruling
As recently reported by the American Bankruptcy Institute (ABI), the Supreme Court is weighing whether to grant or deny a petition for certiorari that challenges the Second Circuit's decision in In re Tribune Company Fraudulent Conveyance Litig. (2nd Cir. 2019). At issue in Tribune is the denial of safe harbor, as established in Section 546(e).
Circuits Split on Applying Derivative Jurisdiction to a Lack of Personal Jurisdiction
As recently reported by the American Bankruptcy Institute, an Eleventh Circuit decision regarding derivative jurisdiction in relation to subject matter jurisdiction has created a circuit split.
The Third Circuit Confirms That Bankruptcy Setoff Rights Are Limited To Two-Party Obligations
The court ruled against drug distributor McKesson Corporation (“McKesson”) in its attempt to clear $6.9 million in debt owed to a pharmaceutical company by leveraging $9.1 million the drug maker owed to one of McKesson's subsidiaries. The Third Circuit affirmed lower courts' decision to reject this “triangular setoff,” indicating that the arrangement is unenforceable under the Bankruptcy Code regardless of parties' contract terms.
SBA's 2nd Notice: Everything You Need to Know About the Extended Paycheck Protection Program
On April 8th, the Small Business Administration issued a Second Notice to lenders regarding an important modification made to the March 30, 2021 SBA Procedural Notice 5000-20074 and SBA Forms 3506, 3507, and 750.The modification contains a key restriction, “which provides from that from June 1, 2021 through June 30, 2021, SBA shall not accept new Paycheck Protection Program (“PPP”) Loan guaranty applications from lenders and shall only process PPP Loan guaranty applications submitted by lenders to SBA before June 1, 2021.”
Lien Disclosure and Renewal in Bankruptcy
On February 2, 2021, the U.S. Bankruptcy Court for the Northern District of Ohio issued a judgement on In re Horvath, a case in which Debtors reopened a Chapter 7 bankruptcy case ten years after the lien had originally been filed in order to avoid a renewed lien.
Does Bankruptcy Attorney Negligence Restrict a Debtor's Lien Avoidance?
In a recent opinion, Judge Russ Kendig of the U.S. Bankruptcy Court Northern District of Ohio highlighted the importance of an attorney’s investigative obligations.
Fed Sounds Alarm on Commercial Real Estate and Business Bankruptcy
Many businesses are struggling with debt or reduced demand in the wake of the COVID-19 pandemic. As of May 2020, it was estimated that more than 100,000 businesses had closed permanently since March.
Must Small Businesses Be ‘Currently Engaged’ in Business for Subchapter V Debt Relief?
The Small Business Reorganization Act (SBRA) was passed in 2019 to expedite the bankruptcy process for small business debtors and reduce costs. This act did not change existing chapter 11 provisions in the Bankruptcy Code, but rather it added new subchapter V terms that streamline the reorganization path for entities with total debts under about $2.7 million.
Eleventh Circuit Authorizes the SBA To Exclude Debtors From Receiving PPP Loans
On March 27, 2020, the $2.2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act provided the U.S. Small Business Association (SBA) with the authority to issue loans under the Paycheck Protection Program (PPP.)
“Excessive Caution” in a Bankruptcy Case Could Limit Creditors’ Fee Allowance Request
In late 2020, the U.S. Bankruptcy Court for the Northern District of Iowa clarified Section 506(b) of the Bankruptcy Code. The Court’s decision imposes the responsibility on lenders’ counsel to “exercise restraint” in billing judgments, suggesting that a creditors’ fees should not exceed the debtors’ in a bankruptcy hearing.
Safe Harbor-Protected Transactions: Detroit Judge Challenges Second Circuit Ruling Based on Supreme Court Decision
In 2018, a Supreme Court Case clarified when the safe harbor applies. In its ruling, the Court unanimously agreed the safe harbor does not protect allegedly fraudulent transfers “in which financial institutions act as mere conduits.” The American Bankruptcy Institute, however, highlighted how recent litigation pokes holes in this conclusion, particularly when it comes to the definition of a financial institution.
Is Your Protection as an Estate Representative Based on a Court’s Discretion?
The Barton Doctrine dates back to an 1818 Supreme Court decision, dictating when a litigant can bring a lawsuit against an estate trustee. Throughout the 20th century, court rulings extended this coverage to include a range of fiduciaries granted authority by a bankruptcy court, like bankruptcy attorneys, accountants, and debtors’ counsel.
How Business Bankruptcies Work
Bankruptcy often serves as a last resort for business owners, but it can also make a difference long before desperate measures are required. Business bankruptcy may be the best situation if your personal assets appear to be at risk.
Everything You Need to Know About Chapter 11 Bankruptcy
Chapter 11 bankruptcy, most commonly used by corporate entities, involves the reorganization of a debtor’s business dealings, assets, and debts. Chapter 11 is perhaps the most complex form of bankruptcy under U.S. bankruptcy laws, so it makes sense that you might have a few questions about how long it takes, how it affects employees, and what it means for a business moving forward.
How to File for Bankruptcy After Coronavirus Shut Down Your Business
Many small businesses across the country are struggling to survive the challenges posed by the COVID-19 pandemic. If your business is searching for options and time to turn around operations or develop new business lines, bankruptcy can create that space and time.
What Are the Types of Bankruptcy for Businesses?
Business bankruptcy might bring to mind bleak images of financial ruin that involve the loss of all valuable property. In reality, bankruptcy takes many forms—and in several situations, it’s a viable solution to the burden of debt that overshadows many business operations.
What to Expect From the Anticipated Surge of Business Bankruptcies in Nevada
Businesses of all sizes and spanning a range of industries are suffering the economic fallout of COVID-19. This can be seen not only in layoffs and furloughs, but also in increased business closures and bankruptcies. A Bloomberg report published in early July revealed that nearly 200 businesses cited COVID as a factor in declaring bankruptcy. Unfortunately, this is only the beginning.
Ninth Circuit Rules on Debtor’s Ability to Recover Reasonable Attorney’s Fees for Stay Violations
On October 14, 2015, the Ninth Circuit Court of Appeals (the “Court”) issued an opinion that addressed the timeframe for which debtors in bankruptcy can recover attorney’s fees for seeking damages for violations of the automatic stay.
Caesars Bankruptcy Venue Determined
Delaware Bankruptcy Judge Kevin Gross ruled the reorganization of Caesars Entertainment Corp.’s largest operating unit will take place in Chicago, major victory.
Student Loan Debt
Student loan debt is at an all time high, but too many people’s surprise, it is helping the U.S. Economy - according to a new report released by the White House Council of Economic Advisers.
Debtors Must Provide Clear Evidence to Argue a Bankruptcy Appeal’s Mootness
The appeal followed the confirmation of a Chapter 11 reorganization plan filed by corporate debtors operating nursing homes. Under the plan, the debtors agreed to reject leases for unprofitable locations, restructuring their business around cost-effective facilities.
The Outer Limits of Discharge Explored by the Ninth Circuit BAP
As recently reported by the American Bankruptcy Institute (ABI), the Ninth Circuit Bankruptcy Appellate Panel (BAP) has issued a decision that explores “the fringes of the bankruptcy discharge injunction.” They provided meaning for “personal liability of the debtor” as laid out in Section 524(a), and further defined the ability of bankruptcy courts to review decisions by state probate courts.