BankruptcyProf Blog

Circuit Court of Appeals Cases for Last Week

(or the week before I should say - I've been busy - 3 chapter 11s this week, all people who don't qualify for chapter 13 trying to save real property)

7th Circuit Court of Appeals, September 02, 2008
Freeland v. Enodis Corp., --- F.3d ---, 2008 WL 4053032 (7th Cir. 2008)(fraudulent coveyance actions remanded for further findings)

8th Circuit Court of Appeals, September 04, 2008
Milavetz, Gallop & Milavetz v. US, --- F.3d ---, 2008 WL 4068448 (8th Cir. 2008)(attorneys providing bankruptcy assistance are "debt relief agencies" and section 526(a)(4) is unconstitutional as applied to these attorneys but sections 528(a)(4) and (b)(2) are constitutional)

9th Circuit Court of Appeals, September 04, 2008
Burkhart v. Coleman, In re Tippett, --- F.3d ---, 2008 WL 4070690 (9th Cir. 2008)(unauthorized post-bankruptcy sale of real property causes title to rest with the purchaser, not the bankruptcy estate, where: 1) the chapter 7 trustee failed to record the petition; and 2) a bona fide purchaser bought and recorded title in the property)

Thanks to Findlaw.com

Judge Sandra Lynch to Head First Circuit Court of Appeals

Judge Lynch is the "first and only woman judge" on the 1st Circuit according to the announcement which may be accessed here. 

Judge Dennis Montali Takes Over as Chief Judge of the 9th Circuit BAP

The announcement can be accessed here.  Judge Christopher Klein has left the BAP after ten years as required under the local rules.  There are six judges on the 9th Circuit BAP.  A seventh position has remained open so that other judges may fill in as a pro tem and get the experience. 

Revisions to Federal Rule of Evidence 502 - Attorney Client Privilege

The House of Representatives has passed Senate Bill S 2450, which creates a new Federal Rule of Evidence 502 (limiting waivers of the attorney-client privilege and work-product rule). The full text of the rule and explanatory material can be accessed here.  The President is expected to sign the bill within the next few weeks.

Median Income Amounts Change Effective October 1, 2008

The UST has announced the new median income figures for each state effective October 1, 2008.  Those can be accessed here. 

CDCBAA Awards Dinner November 6, 2008

THE CENTRAL DISTRICT CONSUMER BANKRUPTCY ATTORNEYS ASSOCIATION

2008 CALVIN ASHLAND AWARDS DINNER

TO HONOR JUDGE OF THE YEAR,

The Honorable Geraldine Mund

(To be presented by prior Calvin Ashland Judge of the Year, Samuel L. Bufford)

Reception and no-host bar at 6:00 p.m. followed by dinner and awards presentation at 7:00 p.m.

Marriott Hotel Grand Ballroom
333 South Figueroa Street
Los Angeles, CA 90071

For seating availability, please call Peter M. Lively at (310) 899-0630

All RSVP Forms and checks must be mailed to: 

cdcbaa
c/o Henry Toles, Treasurer
11746 Goshen Avenue Suite #1
Los Angeles, CA 90049-6113

Prof. Christian Weller's Comments on the Mortgage Mess

From Prof. Bob Lawless and Credit Slips. 

Fannie Mae and Freddie Mac Seized by U.S.

From Prof. Dale Oesterle BusinessProf Blog:

"Over the weekend the United State Government, read Treasury Secretary Henry Paulson, seized two federally charted mortgage companies, Fannie Mae and Freddie Mac.  This comes on the heels of a federally sponsored buyout of one our largest investment banks, Bear Stearns.  Now there is news that the three largest automobile companies, GM, Ford and Chrysler, want federal loans to sustain their companies.  For any who criticize the United States for engaging in "naked capitalism,"  this is proof that they are way off the mark.  We do not have anything close to a "free" market economy -- it is heavily managed.

The seizure of Fannie Mae and Freddie Mac makes two major mistakes and two minor ones as well.  The two major mistakes -- it is a windfall bailout of the subordinated debt holders of both companies -- the government preferred stock dividends and option to buy common take behind the current obligation to pay subordinated debt holders.  The subordinated debt holders, like the stock holders of both institutions should be wiped out -- they took a risk for return gamble and it failed.  Second, the remaining companies will still play the public interest game of lending money at below market rates to stimulate the mortgage market.  The companies are not, with government ownership, any more profit driven than they were before the seizure.  This should be no surprise -- government run companies are always quasi-political animals. In other words, the government will use these companies to "stimulate" the economy - a backdoor grant system. Great.

  The minor mistakes -- first, the company should sue the previous CEOs for breach of fiduciary duty and get back some of the outrageous salary and severance benefits they claimed while running the company into the ground.  Second, we should know the names of the politicians that carried the water for these companies for years, blocking reform efforts, so as to get campaign contributions.  Who are the Fannie Mae and Freddie Mac eight (or whatever)?"