3rd Circuit

Recent Decisions Bar Cramdown on Mixed-Use Principal Residences

Newark and Buffalo judges read 1322(b)(2) narrowly and in favor of mortgage lenders.

Clark v. Rameker’s Gaping Loophole Allows Debtors to Retain Inherited IRAs

State law overrides ‘significant policy concerns’ in Supreme Court decision.

Plan’s Treatment of Secured Claim Trumps Failure to Redeem on Time

Courts split on whether failure to redeem on time is fatal in reorganization.

Third Circuit Insulates the IRS from Preference Claims for Trust Fund Taxes

Aggregation was not permitted to surmount the $6,225 minimum for preferences.
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Third Circuit Tries to Synthesize Illinois Law on Veil Piercing and Unjust Enrichment

Third Circuit relies on a Seventh Circuit opinion to understand Illinois law.
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Tender Offers in Bankruptcy Pass Muster in the Third Circuit

Third Circuit holds again that equal treatment is not required in settlements.
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Subjective Test Without Hindsight Employed to Determine Adequate Capitalization

Later bankruptcy is no proof of prior inadequate capitalization.
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Valuation Date Chosen to Avoid ‘Gamesmanship’

Early valuation aids a debtor in stripping off during an up market.

Judges Sontchi and Drain Agree on Treatment Among Undersecured Creditors

No need for venue-shopping between Delaware and New York for undersecured creditors.