Arbitration Nixed on a Lender’s Claims for Violation of the Automatic Stay
Bankruptcy Judge Paul Black denied a motion to compel arbitration but didn’t decide whether he would certify a class.
A Partial Ethical Wall Didn’t Give Rise to Disinterestedness, Judge Kenney Said
Expedience is no substitute for disinterestedness when it comes to retention of a chapter 11 debtor’s general counsel.
Fourth Circuit Broadly Defines Restitutions that Aren’t Discharged in Chapter 13
The federal appeals court brushed aside technicalities under state criminal law in deciding that an order for restitution was not discharged under Section 1328(a)(3).
Court:
As Subsequent Transferees, Churches Must Cough Up Fraudulent Transfers
Judge Huennekens explained that a church’s immunity for receipt of a constructively fraudulent transfer only applies if the transferor was an individual and the transferor was the debtor.
RSAs Don’t Bar Indenture Trustees from Creditors’ Committee Membership
Bankruptcy Judge Brian Kenney ruled that an indenture trustee must be on a committee when the debt is ‘overwhelmingly’ held by bondholders.
An Agreement to Modify a Mortgage Was an Assumable Executory Contract
Is pre-filing a mortgage modification agreement a contract to make a loan that cannot be assumed under Section 365(c)(2)?
Orders for Contempt and Sanctions Aren’t Appealable in the Fourth Circuit
Whether orders in contested matters are ever appealable is in doubt after a Fourth Circuit decision that declined to follow contrary opinions by bankruptcy appellate panels.
Court:
Fourth Circuit Says Entireties Property Is Not Exempt from Tax Debt
The lack of perfection of a federal tax lien did not mean that the entireties interest was exempt under Section 522(b)(3).
Court:
Being a ‘Net Winner’ in a Ponzi Scheme Doesn’t Automatically Mean Nondischargeability
Alleging that a debtor realized an ‘impossibly high’ rate of return in a Ponzi scheme isn’t enough to state a claim of nondischargeability for ‘actual fraud.’
Lack of Financial Distress Doesn’t Divest a Court of Subject Matter Jurisdiction
Two North Carolina Courts have held within two months that the Bankruptcy Clause doesn’t demand ‘financial distress’ to establish subject matter jurisdiction.