Second Circuit Revives $3.75 Billion in Lawsuits by the Madoff Trustee Against Financial Institutions
Reversing in favor of the Madoff trustee, the Second Circuit rules that inquiry notice, not willful blindness, governs the good faith defense by recipients of fraudulent transfers.
Court:
In ‘Chapter 20,’ Discharged Mortgage Claim Resurrects as Unsecured, EDNY Judge Says
Judge Grossman didn’t abolish ‘chapter 20’ entirely. He required the debtor to treat the subordinate mortgage lender like all other unsecured creditors, even though the debtor’s personal liability to the lender had been discharged in the prior chapter 7 case.
District Judge Rakoff Explains Why the Debtor Alone May Assert a Cure Claim
A creditor can’t assert a cure claim, even though Section 365(b) doesn’t give the counterparty the sole right to demand a cure on assumption of an executory contract.
Second Circuit Makes Taggart Applicable to All Contempt Citations in Bankruptcy Court
Even for egregious, repeated violations of Bankruptcy Rule 3002.1, the bankruptcy court may only award recovery of economic losses, never punitive damages.
Court:
All Private Student Loans Are Not Excepted from Discharge, Second Circuit Holds
No circuit split: The Second Circuit agrees with the Fifth and Tenth Circuits that only a subset of private student loans is automatically nondischargeable.
Court:
Being an ‘Officer’ Disqualifies Someone from a KERP, New York District Judge Says
Officers are presumptively disqualified from KERPs, “absent a strong showing that they do not perform any significant role in management,” a district judge in New York says.
IRA Withdrawals Aren’t Protected from Madoff Fraudulent Transfer Judgments
Madoff defendant socked with $280,000 in prejudgment interest for relitigating issues decided long ago.
Filing Chapter 15 as a ‘Litigation Tactic’ Didn’t Bar ‘Foreign Main Recognition’
Bankruptcy Judge Garrity didn’t impose a good faith filing requirement onto foreign main recognition of a chapter 15 case.
The Pleading and Proof Required for Claims Against a Subsequent Transferee
Read Judge Grossman’s opinion as though it were a final exam question to see how many issues you spot and whether you come up with the correct answers.
Judge Glenn Explains When Structured Dismissals and Comfort Orders Are Ok
Jevic didn’t ban structured dismissals when there is no violation of the rules of priority and the alternatives would create greater administrative insolvency.