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June 14, 2008

Circuit Court of Appeals Cases for Last Week

3rd Circuit Court of Appeals, June 10, 2008
Windt v. Qwest Communications Int., Inc., --- F.3d ---, 2008 WL 2345151 (3d Cir, 2008)(trustee's complaint dismissed for forum non conveniens)

8th Circuit Court of Appeals, June 10, 2008
US v. Mitchell, --- F.3d ---, 2008 WL 2345033 (8th Cir, 2008)(conviction of debtor for making a false statement in bankruptcy case, double jeopardy rejected)

June 14, 2008 in Other Circuit Briefs | Permalink | Comments (0) | TrackBack

June 13, 2008

LandSource Organizational Meeting to be held June 20, 2008 in Delaware

District of Delaware
Organizational Meetings
June 20, 2008 11:00 a.m. 08-11111 (KJC) LandSource Communities Development LLC J. Caleb Boggs Federal Building
844 King Street, Room 5209
Wilmington, DE 19801
June 16, 2008 1:00 p.m. 08-11133 (CSS) Goody's Family Clothing The DoubleTree Hotel
700 King Street, Salon C
Wilmington, DE 19801
June 12, 2008 11:00 a.m. 08-11101 (KG) Distributed Energy Systems Corp. J. Caleb Boggs Federal Building
844 King Street, Room 2112
Wilmington, DE 19801

June 13, 2008 in Current Affairs | Permalink | Comments (0) | TrackBack

US Trustee Studies Financial Management Programs

Chapter 7 and chapter 13 debtors are required to complete a postpetition Financial Management Course before entry of the discharge.  The US Trustee has conducted a study of the effectiveness of the program and has concluded that it is pretty good (my non-bureaucratic label).  You can get the full report here. 

According to the report 97% of the debtors in the study "expressed a high level of satisfaction with the curriculum."  Half reported their "intention to change at least one financial practice."  There was not, however, substantial improvement in "knowledge and financial practices."  The report speculates that this is "likely due to pre-existing knowledge regarding the topics measured."  Huh?  They didn't learn more because they already knew what was measured? 

The 97% is good news.  It is widely believed in the lofty tower that the pre-petition counseling is a waste of time and money which I have no doubt it is.  It would be nice to see some hard numbers though. 

June 13, 2008 in Current Affairs | Permalink | Comments (0) | TrackBack

June 12, 2008

Who Voted for BAPCPA?

McCain voted for, Obama voted against, Clinton did not vote.  See the votes of all the senators here. 

June 12, 2008 | Permalink | Comments (0) | TrackBack

June 11, 2008

City of Vallejo Chapter 9

The City of Vallejo has a very nice website with immediately accessible documents filed in its chapter 9 bankruptcy case.  The city, just above and east of San Francisco, has 121,000 residents and 407 employees, the bulk of whom belong to one of several unions.  It has an annual budget of $87 million of which 76% is labor costs.  There was some dispute initially whether the city qualified for chapter 9 relief but the court agreed that it did and entered the Order on May 30, 2008. 

June 11, 2008 in Current Affairs | Permalink | Comments (0) | TrackBack

June 10, 2008

Further Thoughts on Kagenveama

I received a call asking me why Ms. Kagenveama's net income from Schedules I and J of $1,500 was so much different than the B22C means test of minus $4.  My first thought was that the means test net income is always less when the debtor owns a home and has car payments because the debtor gets the IRS allowance amounts and the secured debt also.  But I looked up the debtor's forms to see if that was the case here. 

The debtor's I and J showed $2,572 of monthly expenses.  If you take away the mortgage payments which include property taxes and insurance and take away the car expense and insurance, the total monthly expenses are about $1,030.  The IRS National Standard and the Local Standard - non-mortgage alone allowed the debtor $1,805 so that is almost $800.  The IRS auto allowances on the B22C totaled $614 plus the $186 car payment for a total of $900 but the Schedule J totaled only $444 (Schedule J did not have the $186 car payment, apparently an oversight).  In addition, the means test allowed deduction of the amount needed to cure the mortgage of $141 per month and a hypothetical payment to the chapter 13 trustee of $84. 

Most interesting to me is that the debtor deducted $100 on the means test as cell phone, pager etc "necessary for health and welfare."  If the trustee had objected to $10 of this amount, the means test would not have been a negative amount and a five year plan would have been required (although not necessarily at $1,000 per month). 

So the answer to the question, why were the amounts different, is primarily that the debtor's monthly personal expenses were less that the means test allowances.  Short and sweet - what a concept! 

June 10, 2008 in 9th Circuit Briefs | Permalink | Comments (0) | TrackBack

Sharper Image Goings-On

Creditor's Committee Counsel Cooley Godward filed its fee application in the Sharper Image chapter 11 case for April, 2008 seeking $238,000 in fees for the month.  The fee application for March requested $425,000 in fees (which were approved).  The financial advisor for the Committee has requested $124,000 for April. 

On May 30, the court approved a "second going-out-of-business" sale for the bulk of the remaining 80 some-odd stores.  Apparently, the deal Sharper Image had to sell the assets as a going concern did not materialize.  As it will now liquidate, it is facing the termination of the bulk of its remaining employees and has therefore sought permission to pay severance pay to these employees.   

June 10, 2008 in Current Affairs | Permalink | Comments (1) | TrackBack

June 9, 2008

Supreme Court Justices Disclose Finances

The New York Times article last Friday on the annual financial disclosures of the individual justices of the Supreme Court may be found here.    Ruth Bader Ginsburg and David Souter appear to be the wealthiest with Anthony Kennedy and Samuel Alito at the other end. 

June 9, 2008 in Supreme Court | Permalink | Comments (0) | TrackBack

June 8, 2008

Circuit Court of Appeal Bankruptcy Cases for Last Week

4th Circuit Court of Appeals, June 03, 2008
In re Meredith, --- F.3d ---. 2008 WL 2251861 (4th Cir. 2008)(defendant not "the entity for whose benefit such transfer was made" and therefore no avoidable fraudulent transfer)

5th Circuit Court of Appeals, June 03, 2008
In the Matter of Maples, --- F.3d ---. 2008 WL 2249953 (5th Cir. 2008)(court affirms judgment but comments on condition of brief, record on appeal, jurisdiction and other shortcomings of appellant)

6th Circuit Court of Appeals, June 02, 2008
Schultz v. U.S., --- F.3d ---. 2008 WL 2229495 (6th Cir. 2008)(dismissal of constitutional attack on BAPCPA affirmed) 

9th Circuit Court of Appeals, June 04, 2008
In re Imperial Credit Indus., Inc., --- F.3d ---. 2008 WL 2264588 (9th Cir. 2008)(rulings against bank holding company re performance guaranty and claim priority affirmed in part and reversed in part)

9th Circuit Court of Appeals, June 05, 2008
In re Kagenveama, --- F.3d ---. 2008 WL 2278681 (9th Cir. 2008)(chpater 13 plan by above-median debtor does not have to be five years when the means test calculation shows negative "disposable income")

June 8, 2008 in Other Circuit Briefs | Permalink | Comments (0) | TrackBack

cdcbaa Newsletter Vol 4

The Central District (of California) Consumer Bankruptcy Attorneys Assoc has published vol 4 of its newsletter.  It can be found here. 

June 8, 2008 in Current Affairs | Permalink | Comments (0) | TrackBack