New York Eastern District

Judge Explains Why Tax Liens Are Subordinated to Domestic Support Obligations

Congress decided to deviate from standard priorities by providing in Section 724 that unsecured domestic support obligations come ahead of tax liens.

Consent to a Sale for Less than the Mortgage Debt Doesn’t Waive a Deficiency Claim

A secured lender need not obtain a deficiency judgment to retain a claim against an insurer for a shortfall in a bankruptcy sale, Bankruptcy Judge Grossman says.

Bankruptcy Judge Stong Penned a Compendium About Eligibility for Subchapter V

Another judge holds that dealing with debt from a defunct business satisfies the eligibility requirement for Subchapter V.

Another Article III Judge Won’t Let Bankruptcy Stop Suits Against Nondebtors

The same day the Supreme Court decided to hear Purdue, a district judge on Long Island, N.Y., sent dozens of long-stayed sexual abuse cases back to state court where the debtor is not a named defendant.

Trustee Admonished for Filing Suit Reflecting a ‘Disturbing Lack of Judgment’

Providing an adult child with room and board in the family home is not a fraudulent transfer.

Lack of Reliance on Representation Isn’t a Defense to a Constructive Fraudulent Transfer

Damages for a constructively fraudulent transfer were the difference between what the buyer paid and what the business was really worth, based on accurate income and expenses.

Buying a Claim Carries with It the Right to Assert Nondischargeability

Joining the majority of courts, Judge Grossman says that the debtor’s conduct, not the identity of the holder of the claim, determines nondischargeability.

Average Lateness and Bucketing Tests Confirm the Ordinary Course Defense

A district judge in Brooklyn applied the two most commonly used tests for the ‘ordinary course’ defense to uphold dismissal of preference complaints.

Bankruptcy Judge Finds Liability for a Municipality’s Denial of Due Process Rights

A local government removed a lawsuit to bankruptcy court, but the bankruptcy judge turned around and slam-dunked the government for violating the plaintiff’s Fourteenth Amendment rights.

District Judge Effectively Bars a Short Sale Without Paying the Homestead Exemption

Reversing, a Long Island district judge credits value to a homeowner’s ability to delay foreclosure, taking a position contrary to a recent decision from a Ninth Circuit B.A.P.