5th Circuit

Lender Socked in Dallas with $17 Million in Damages for Breach of Contract and Fraud

A lender’s breach of a factoring agreement forced a company into bankruptcy that would have survived otherwise, Judge Jernigan says.

Fifth Circuit Has Rigid Standards for Chapter 7 Debtors to Have Standing to Appeal

An individual chapter 7 debtor has standing to appeal if the appeal could affect the debtor’s right to a discharge.

Arbitration Clause Not Enforceable When the Contract Itself Was Rejected

Judge Jernigan in Dallas differs with a judge in Delaware by declining to enforce an arbitration agreement that was part of a rejected contract.

Res Judicata Limits an Objection to a Claim Allowed in a Prior Bankruptcy

Reducing a claim between the first and second bankruptcy didn’t prevent the Fifth Circuit from employing res judicata.

Reducing a Personal Guarantee Under a Plan Isn’t a Discharge, Fifth Circuit Says

The appeals court barred the holder of a personal guarantee from launching a collateral attack on a confirmed chapter 11 plan.

Three-Year Bar to Refiling in Chapter 13 Imposed for ‘Vexatious, Frivolous’ Litigation

Motions to recuse three bankruptcy judges fortified the third judge’s decision to dismiss and bar refiling for three years.

Surety Bonds Aren’t Executory Contract and Can’t Be Assumed, District Judge Says

An irrevocable surety bond isn’t executory because it gives the bonding company no further obligations to the debtor.

On an ‘Involuntary,’ Denial of Summary Judgment Doesn’t Mean the Claim Is Disputed

The Iqbal and Twombly standards don’t apply to involuntary petitioners who are required to use Official Form 105.

A Lender Is Entitled to Demand a Change in Management, Fifth Circuit Says

It isn’t duress when a lender threatens to take action that the loan agreement allows, the circuit court says.

Statutory Mootness of Sale Orders Even Overrides Alleged Due Process Violations

Fifth Circuit rejects technical arguments aimed at skirting Section 363(m) and statutory mootness of a sale order.