BankruptcyProf Blog

John Wooden 1910-2010

I cannot see John Wooden's picture or listen to any of the tributes and programs without getting weepy.  He was the greatest man of my lifetime.  I saw him many times at a restaurant in Encino, once with Bill Walton, and always wanted to shake hands with him but never did.  Another loss for mankind.   

New Hamp Regulations

Thx to Karen Cordry:

New Home Affordable Modification Program (“HAMP”) Loan Modification Guidelines Taking Effect June 1, 2010

The federal government provided new HAMP borrower outreach and communication guidelines for foreclosure actions while a borrower is being evaluated under HAMP.  Furthermore, these guidelines provide additional protection for delinquent borrowers who have filed bankruptcy but would otherwise be eligible for HAMP benefits. For a copy of the full disclosure, see Supplemental Directive 10-02.

Here are some of the key highlights from the directive include:

FORECLOSURE
Additional Foreclosure steps are required:
• The servicer must evaluate the borrower’s eligibility under HAMP and determine that the borrower is ineligible before referring the borrower to foreclosure (or make “reasonable solicitation efforts”).
• If foreclosure activity has already been initiated, the foreclosure sale cannot occur until after the servicer has determined the borrower is ineligible under HAMP (or make “reasonable solicitation efforts”).
• The servicer must give the borrower 30 days to respond to HAMP “Non-Approval Notices” in certain circumstances before conducting the foreclosure sale.
• The servicer must provide the foreclosure attorney certification in writing that the borrower is ineligible for HAMP before conducting the foreclosure sale.

BANKRUPTCY
• If the borrower in active Chapter 7 or Chapter 13 bankruptcy (or attorney or bankruptcy trustee) requests, the servicer MUST consider the borrower under HAMP and can no longer decline borrower as a “proper exercise of discretion.”
• If the borrower has been approved on a trial loan modification and files a Chapter 7 or Chapter 13, the servicer MAY NOT deny the borrower for a permanent modification only because of filing bankruptcy.
• If a delinquent borrower has a discharged Chapter 7 and chose not to reaffirm the first lien mortgage debt is still eligible under HAMP, with the following provision added to the permanent modification agreement: “I was discharged in a Chapter 7 bankruptcy proceeding subsequent to the execution of the Loan Documents. Based on this representation, Lender agrees that I will not have personal liability on the debt pursuant to this Agreement.”

Karen Cordry, Bankruptcy Counsel
National Association of Attorneys General

Nice Powerpoint on the new Consumer Financial Protection Agency

Prof. Jeff Sovern has prepared a nice powerpoint summary of the two bills creating a new federal Consumer Financial Protection Agency.  You can access the presentation here. 

Texas Rangers File Chapter 11

U.S. Bankruptcy Court
Northern District of Texas (Ft. Worth)
Bankruptcy Petition #: 10-43400-dml11

Assigned to: D. Michael Lynn Chapter 11 Voluntary

Date filed:   05/24/2010

Debtor Texas Rangers Baseball Partners 1000 Ballpark Way Suite 400 Arlington, TX 76011 Tax ID / EIN: 75-2585320	represented by	Martin A. Sosland Weil, Gotshal & Manges LLP 200 Crescent Court, Suite 300 Dallas, TX 75201-6950 214-746-7700 Fax : 214-746-7777 Email: martin.sosland@weil.com Ronit J. Berkovich Weil, Gotshal & Manges LLP 767 Fifth Avenue New York, NY 10153 212/310-8000 Fax : 212/310-8007
U.S. Trustee UST U.S. Trustee 1100 Commerce Street Room 976 Dallas, TX 75242-1496 214-767-8967	represented by	Meredyth Kippes US Trustee 1100 Commerce St. Rm. 976 Dallas, TX 75242 Email: meredyth.a.kippes@usdoj.gov

Phoenix Coyotes Still Moving?

From Bankruptcy Beat

May 27, 2010
3:37 PM NHL Sets Deadline For Coyotes Sale, Threatens Move
By Eric Morath

The financially troubled Phoenix Coyotes may still be on the run.

The National Hockey League has set a Dec. 31 deadline for the city of Glendale, Ariz., landlord of the Coyotes’ home rink, to reach an agreement with new owners for the team, the Arizona Republic reported. Otherwise, the NHL may authorize the franchise to move to another market.

The league said it has a “bona-fide offer from a viable purchaser who would relocate the hockey team to another market,” the paper reported, referring to a legal agreement between the NHL and the city.

Circuit Court of Appeals Cases from Last Week

2nd Circuit Court of Appeals, May 18, 2010
Adams v. Zelotes, --- F.3d ---, 2010 WL --------- (2nd Cir. 2010)(attack on the constitutionality of section 526(a)(4), re debt relief agencies advising clients to incur additional debt in contemplation of bankruptcy reversed based on Milavetz)

2nd Circuit Court of Appeals, May 18, 2010
AmeriCredit Fin. Servs. v. Tompkins, --- F.3d ---, 2010 WL --------- (2nd Cir. 2010)(creditor has an unsecured deficiency judgment under both state law and the contract of the parties)

7th Circuit Court of Appeals, May 19, 2010
In re South Beach Sec., Inc., --- F.3d ---, 2010 WL --------- (7th Cir. 2010)(chapter 11 dismissed where: 1) debtor's argument that the U.S. Trustee lacks standing because he is not a party in interest is rejected; 2) reorganization plan had not been proposed in good faith as the debtor's disclosure statement suggests no purpose other than to beat taxes; and 3) debtors and the lawyers that appeared for them are order to show cause why they should not be sanctioned for their conduct in their frivolous appeal)

10th Circuit Court of Appeals, May 20, 2010
In re Latture, --- F.3d ---, 2010 WL --------- (10th Cir. 2010)(appeal untimely where: 1) debtor's failure to timely file the appeal deprived the BAP of jurisdiction to hear his appeal; 2) Fed. R. App. P. 6 did not govern an appeal taken from bankruptcy court to a bankruptcy appellate panel; and 3) even assuming debtor did not receive the court's judgment, the BAP could not extend the time to file a notice of appeal)

California Appellate Districts, May 20, 2010
Boyajian v. Ordoubadi, --- Cal.App. ---, 2010 WL --------- (plaintiff's claim for equitable indemnity was discharged in a bankruptcy proceeding in 1994 as bankruptcy law allows for discharges of contingent claims, including claims against the debtor for indemnity before the time the indemnity claim against the debtor can be precisely measured)