Courts Are Split on Counting Future Rent Toward the $7.5 Million Debt Cap in Sub V
If future liability on unexpired leases and executory contracts is counted, many companies will be ineligible for Subchapter V of chapter 11.
Sub V Plan with Nondebtor Release Approved over Opposition from the Affected Class
A decision from a New York bankruptcy court makes nondebtor releases easier to obtain in Subchapter V than in large, mass tort chapter 11 cases.
Dispute over Part of a Claim Disqualifies an Involuntary Petitioner
The 2005 amendment to Section 303(b)(1) disqualifies an involuntary petitioner if there is a dispute as to even part of the creditor’s claim.
Setoff Can’t Be Raised as a Defense to Receipt of a Fraudulent Transfer
The Madoff case makes more law: A claim against a bankrupt estate can’t be set off against liability for receipt of a fraudulent transfer because one arose before bankruptcy and the other arose after.
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.
A ‘Litigation Tactic’ Isn’t Fatal in Chapter 15
A bankruptcy judge in New York was deferential to foreign liquidators using chapter 15 to extinguish a lawsuit in the U.S. that they saw as a nuisance.
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.
Foreign Sovereign Immunity Bars the Madoff Trustee from Recovering $20 Million
A district judge in New York reversed the bankruptcy court, which had held that a Kuwaiti public pension fund was not entitled to sovereign immunity for having engaged in commercial activity.
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.
A RICO Case Shows that Final Fee Allowances Don’t Confer Immunity
The RICO suit by Jay Alix Against McKinsey mostly survived a motion to dismiss.