Bankruptcy Litigation Committee


Post date: Wednesday, April 01, 2015

Editor's Note: Reprinted with permission from the ABI Journal, Vol. XXXIII, No. 9, September 2014.

Partnership law and bankruptcy law are not strangers. Perhaps no greater proof can be found than in the recent battle over the unfinished-business claims of dissolved law firms, which pit a law firm’s bankruptcy estate against the lawyers that often served as the firm’s lifeblood prior to their bankruptcy filing.

Post date: Tuesday, November 18, 2014
Photo of Monika S. Wiener
Monika S. Wiener

[1]As courts continue to work out the finer points of the “plausibility” standard of pleading announced by the Supreme Court in Bell Atlantic Corporation v. Twombly[2] and further developed in Ashcroft v. Iqbal,[3] plaintiffs are well advised to be as specific as possible in alleging facts to support their claims.[4] A recent decision from a Minnesota bankruptcy court emphasizes that this is especially true when it comes to invoking the equitable doctrine of recharacterization as a means of converting debt to equity in a bankruptcy case.[5]

Post date: Tuesday, November 18, 2014

A significant body of literature has developed in the wake of Stern v. Marshall[1] and the evolving roles of the courts. Aside from the incurred costs from dragging a bankruptcy judge’s proposals through the district court for review, the practical significance of mandating these steps depends on the tendency of district courts to adopt the bankruptcy court’s recommendations. However, there is a procedural disconnect with respect to the manner in which some courts carry out their roles that can leave experienced practitioners confused — and pro se litigants in peril.

Post date: Tuesday, November 18, 2014
Photo of Matthew D. Sobolewski
Matthew D. Sobolewski

VWI Properties LLC, the pre-petition purchaser of the secured debt associated with the hotel property owned by Mt. Olive Hospitality LLC (the debtor), filed several objections challenging the validity of certain unsecured claims totaling more than $4 million and the characterization of those claims as debt.

Post date: Tuesday, November 18, 2014

Recharacterization is a judicial doctrine originating in the case law of most state courts. Its main tenet is that “a spade should be called a spade”; that is, if an extension of credit has more of the characteristics of equity than of debt, it should be treated like equity even if it was denominated as debt.

Post date: Friday, October 03, 2014

Your client has been providing products to a customer for years. The client is not paid directly by its customer, but by the customer’s parent company as part of a cash-management system (CMS), what the customer describes as an enterprise-wide pooled account. After a couple of turbulent months with irregular payments, the customer files for bankruptcy.

Post date: Monday, September 08, 2014

When dealing with customers in financial distress, the time-tested advice of “always take the money” are words to live by if you are a vendor with an open account payable. It is widely understood that such payments may be “clawed back” as preferences under § 547 of the Bankruptcy Code if the customer declares bankruptcy within 90 days of payment.

Post date: Monday, September 08, 2014

Two years after the U.S. Court of Appeals for the Eleventh Circuit issued its decision in Senior Transeastern Lenders v. Official Committee of Unsecured Creditors (In re TOUSA Inc.), 680 F.3d 1298 (11th Cir. 2012), lenders may still unwittingly be at risk when making revolving loans to multiple borrowers that utilize a central cash-management system.

Post date: Thursday, May 22, 2014

In November 2013, the Third Circuit decided In re KB Toys Inc.,[1] which has created a split of authority between Delaware and New York concerning the defenses of claims traders to preference liability. KB Toys may chill claims trading within that Circuit, while existing favorable treatment remains within the Southern District of New York.

Post date: Thursday, May 22, 2014

The Fifth Circuit’s ruling on Nov. 11, 2013, in BP RE L.P. vs. RML Waxahachie Dodge L.L.C. et al..[1] extended what it had previously acknowledged was a “narrow ruling” by the U.S. Supreme Court in Stern vs. Marshall.[2] The panel essentially held that the authority granted to the bankruptcy court to enter final orders and judgments under 28 U.S.C. §157(c)(2) is unconstitutional, despite express consent.


Mr. John C. Cannizzaro
Ice Miller LLP
Columbus, OH
(614) 462-2700

Ms. Isley Markman Gostin
Washington, DC
(202) 663-6551

Mr. Mark A. Platt
Communications Manager
Frost Brown Todd LLC
Dallas, TX
(214) 580-5852

Ms. Sara L. Abner, Esq.
Education Director
Frost Brown Todd LLC
Louisville, KY
(502) 779-8178

Mrs. Dana L. Robbins
Membership Relations Director
Burr & Forman LLP
Tampa, FL
(813) 367-5760

Mr. Jon Jay Lieberman
Special Projects Leader
Sottile & Barile LLC
Loveland, OH
(859) 912-1659

Please note that in order to view the content for the Committee Newsletters you must either sign in if you are already an ABI member, or otherwise you may Become an ABI Member