July 11, 2009
Circuit Court of Appeals Cases from Last Week
6th Circuit Court of Appeals, July 06, 2009
QSI Holdings, Inc. v. Alford, --- F.3d ---, 2009 WL ---------------- (6th Cir 2009)(section 546(e) defense to fraudulent conveyance extends to the leveraged buyout at issue, involving privately held securities)
8th Circuit Court of Appeals, July 08, 2009
Educational Credit Mgmt. Corp. v. Jesperson, --- F.3d ---, 2009 WL ---------------- (8th Cir 2009)(debtor not entitled to an undue hardship student loan discharge as debtor is a recent law school graduate who is reasonably likely to be able to make significant debt repayments in the foreseeable future and qualified for the Department of Education's twenty-five year Income Contingent Repayment Plan)
9th Circuit Court of Appeals, July 10, 2009
Biltmore Assocs., LLC v. Twin City Fire Ins. Co., --- F.3d ---, 2009 WL ---------------- (9th Cir 2009)(In an action by former officers of the Debtor for indemnification in an underlying action for breach of fiduciary duty, the "insured versus insured" exclusion in the relevant policies barred coverage, because a post-bankruptcy debtor in possession acts in the same capacity as the pre-bankruptcy debtor for the purpose of directors and officers liability insurance)
11th Circuit Court of Appeals, July 10, 2009
Lawrence v. Goldberg, --- F.3d ---, 2009 WL ---------------- (6th Cir 2009)(where Plaintiff sued his creditors claiming they conspired to wrongfully enforce a turn over order issued by a Bankruptcy Court, complaint is dismissed where Plaintiff failed to obtain leave of the Bankruptcy Court before filing his complaint)
Thanks to Findlaw.com.
July 10, 2009
Central District Filings up 7% in June
In June, 2009, the Central District saw 9,578 total filings compared to 8,965 in May, 8,398 in April, 8,518 in March, 6,967 in February and 5,999 in January. That is 48.550 for the first six months compared 33,396 for the same six months last year or a 45% increase.
Chapter 13s were 2,287 compared to 1,988 in May - 22% of total filings - same percentage as the last three months. That is 457 new petitions per trustee for the month.
There were 110 new chapter 11 petitions compared to 66 in May. Individuals filed 42 of the chapter 11 petitions in June.
This info can be found at the Bankruptcy Data Project.
Witness List for Sotomayor Confirmation Hearings Starting Monday
You can access the list with biographies here. An exhaustive study of her rulings by the Brennan Center can be accessed here. The study concludes she is a "mainstream judge."
July 6, 2009
GM Sale Approved
cdcbaa Ethics Program - July 18, 2009
GENERAL MEMBERSHIP ASSSEMBLY
July 18, 2009 at 10:30 a.m.
Southwestern Law School
3050 Wilshire Blvd., Room W329
3rd Floor in the Westmoreland Building
Los Angeles, CA 90010
MCLE Program, Co-Sponsored by Southwestern Law School,
11:00 a.m. – 1:00 p.m.
Total Hours: 2 hours
“Ethics: Attorneys Beware!: The Unauthorized Practice of Bankruptcy Law”
Jennifer L. Braun, Esq.
Assistant to the United States Trustee
The Honorable Judge Maureen A. Tighe
United States Bankruptcy Judge – San Fernando Valley Division
Holly J. Fujie, Esq.
President, State Bar of California
Jerry C. Baik, Esq.
Supervising Assistant City Attorney,
City of Los Angeles Criminal-Identity Theft and Fraud Unit
Circuit Court of Appeals Cases from Last Week
5th Circuit Court of Appeals, June 30, 2009
Tate v. Bolen, --- F.3d ---, 2009 WL -------------- (5th Cir. 2009)(Debtors allowed to deduct a transportation ownership deduction under the plain language of section 707(b), even though they had no loan or lease payment on their vehicle)
July 5, 2009
8th Circuit BAP Rules that Credit Union Violated the Automatic Stay in Collecting Auto Loan
In re Krivohlavek, --- B.R. ---, 2009 WL ----------- (8th Cir. BAP, May 2009)
Issue: Does a credit union violate the automatic stay when it removes funds from the debtor’s savings account for payment of an auto loan where the debtor has announced she intends to return the vehicle but has not?
The chapter 7 debtor filed her statement of intention with her schedules indicating that she intended to return a vehicle which had been financed by her credit union. The payments on the loan were paid by an automatic deduction from her paycheck which funds were placed into her credit union savings account and then, from there, apparently immediately, transferred out by the credit union in payment of the loan. The payroll deduction was a little more than the loan payment as some of the deduction was for a “Christmas account.” The debtor informed the credit union shortly after she filed that she was going to return the vehicle and that she wanted the automatic payments stopped. The credit union told her “that it did not have the ability to stop the automatic payment of her loan and that the only way to do so was for the Debtor to obtain a form from her employer, sign it, and then submit it to the Credit Union.” The debtor eventually filled out and submitted the right form but by then $1,300 had been taken from her savings account and applied to the loan.
The debtor filed a motion for turnover and for sanctions which the bankruptcy court denied. The credit union argued that it did not “violate the automatic stay because it did not take any affirmative act to collect a debt from the Debtor; it merely received what it believed were voluntary payments on a loan.” The court accepted the credit union’s position that only the debtor could stop the paycheck deductions, it was essentially a one-step process, that is the transfer by the employer to the credit union resulted in the payment, and that since she had not returned the vehicle, she apparently intended to keep it and therefore the credit union could keep the payments.
The 8th Circuit BAP reversed. It disagreed with the factual finding that the credit union was not able to stop the withdrawal from the savings account. “[H]ere the Credit Union took an affirmative step beyond the mere receipt of an automatic payment – it applied a portion of the funds automatically deposited into the Debtor’s account toward payment of a debt. And that affirmative step constitutes an act to collect a debt prohibited by § 362(a)(6).”